Payment program for use in point-of-sale transactions

ABSTRACT

In some embodiments, the present application relates to card-free programs provided by a merchant to a customer, whereby the customer has access to functions such as payment options and/or loyalty program benefits without needing to present a physical card at a point of sale. For example, a customer may make a card-free purchase of goods or services from a merchant, whereby the customer need not present a card such as a debit card, credit card, loyalty card, or other physical tender to make a purchase. Further, the customer need not provide biometric data or otherwise use an electronic device or identifier to make a purchase. Alternatively or additionally, the customer may access a loyalty program without needing to provide a physical card or data associated with a card.

CROSS-REFERENCE TO RELATED APPLICATIONS

The present application claims priority to U.S. Provisional ApplicationNo. 60/702,193, filed Jul. 25, 2005, and entitled “Payment Program ForUse in Point-Of-Sale Transactions,” which is hereby incorporated byreference herein for all purposes.

BACKGROUND OF THE INVENTION

1. Field of the Invention

This invention relates generally to methods and apparatus for conductingretail sales and, more particularly, to methods and apparatus forpayment for retail purchases by consumers enrolled in payment and/orloyalty programs offered by a retailer.

2. Background of the Invention

The retail industry has shown increasing interest in improving theconvenience of the shopping experience. For example, the use of loyaltycards have enabled merchants to reward customers based upon theirpatronage of the merchant. Loyalty cards have also enabled merchants toprovide customers with a variety of other incentives and/or conveniencessuch as check cashing privileges. Furthermore, the use of loyalty cardshave become quite popular with cost conscious shoppers since merchantstypically provide discounts on the goods being purchased whenever theshopper presents a loyalty card issued by that merchant. Merchants haveattempted to minimize the inconvenience to shoppers which results fromrequiring the shopper to present a loyalty card in order to receivediscounts on goods and/or other benefits. For example, some merchantshave issued small tokens that attach to a customer's key ring and, haveimprinted thereon, a scannable code for identifying the shopper as aparticipant in the retailer's loyalty program.

Efforts to improve customer convenience have also focused on speedingtransactions at the point-of-sale (POS) to minimize the amount of timethat a customer waits in line. The widespread adoption of bar codescanners is one result of such efforts. More recently, merchants havebegun exploring the use of radio frequency identification (RFID) tags inorder to quickly inventory the goods in a customer's shopping cart priorto arrival of the customer at the POS. By doing so, the purchase priceof the goods is transferred to the POS, thereby eliminating the need forthe cashier to scan the goods themselves. Likewise, merchants haveexplored other methods of employing RFID tags to speed payments. Forexample, key fobs have been employed to complete purchases of gasoline.Similarly, mountable tags have been employed to both complete purchasesof gasoline and pay for a variety of charges associated with usages oftoll roads, parking facilities and the like. Other methods for speedingpayments have also been explored. For example, personalelectronics-based systems such as mobile telephones and biometricbased-systems that rely on a unique body feature such as a thumb orretina have been employed in a variety of payment scenarios.

Drawbacks of such loyalty and payment systems include the requirementthat a consumer must carry a physical device such as a card, RFID tag ormobile telephone or consent to a biometric scan, a process disliked bymany. Thus, ongoing needs exist for the development for methods forimproving the convenience of a customer's shopping experience,especially in the areas of improved transaction speed, enhanced loyaltyprograms, and combinations thereof. The present application addressessuch ongoing needs, particularly a need for payment and/or loyaltyprograms that do not require presentation of a physical device orconsent to a biometric scan in order to process a payment and/or issuecash rewards or other benefits based upon usage of the loyalty program.

SUMMARY OF THE INVENTION

A variety of methods and apparatus have been developed to address theseand other needs in the art. Each of these is suitable for use alone orin combination with one or more of the other methods and apparatusdisclosed herein. The disclosed methods and apparatus, each of which hasbeen developed to enhance POS transactions in a respective manner, areas follows:

A. A Method For Instantly Enrolling Customers In A Card-Free ProgramOffered By A Merchant. This process enables a customer to enroll in acard-free program offered by a merchant. The card-free program may be,for example, a payment processing program, a loyalty program or aloyalty program linked to the payment processing program (linked loyaltyprogram). The enrollment process is also applicable to other types ofcard-free programs not specifically recited herein. The process ofenrolling in the card-free program may be carried out at any number oflocations and/or using a variety of devices. For example, enrollment maybe carried out at the merchant's premises through use of a pinpad orother data input/output (I/O) device located at a point-of-sale (POS) orstore kiosk for enrollment. Enrollment may also be conducted over thepublic switched telephone network (PSTN) through use of a telephone,over the internet through use of a personal computer (PC) or othercomputer system or by various combinations of the foregoing. In order toenroll, the customer provides identification information that is bothgenerated by, and unique to, the customer. The identificationinformation may include, for example, (i) an identification code,typically comprised of a unique identification number such as thecombination of a telephone number assigned to the customer and the monthand day of birth for the customer, and (ii) an authorization or securitycode, commonly referred to as a personal identification number (PIN).The identification information provided by the customer may beassociated by the merchant with one or more functions of this card-freeprogram, another card-free program, or a card-based program. Forexample, the identification information may be associated with a new orpreexisting loyalty program account of the customer. When the card-freeidentification information is associated with an existing card-basedloyalty account, the customer may access their card-based loyaltyprogram account and/or obtain benefits associated with the card-basedloyalty program without the physical use of a card.

The identification information may be further associated with one ormore payment options such as an automated clearing house (ACH) debitfrom a financial account such as a checking or savings account or acharge to a line of credit such as a bank or merchant sponsored creditcard. To enable such actions, the customer provides, during theenrollment process, the appropriate financial account information (suchas a routing number for a financial institution and an account numberfor the account to be debited) and authorization to debit funds from orcharge purchase to the identified account. The card-free paymentfunctionality may also be linked with the loyalty program functionalityso that the customer receives benefits of the loyalty program forcard-free purchases paid using funds from the identified account. Duringenrollment, the identification number may be optionally associated withadditional functionality of the card-free program such as (i) theability to purchase from affiliated merchants, including, if desired,participation in their loyalty programs, (ii) adding any number ofadditional users such as family members to a master account of acard-free program, (iii) designating multiple payment options such asACH, credit or other payment options, (iv) other types of functionalitynot specifically recited herein, or (iv) combinations thereof. Duringenrollment, the merchant may perform security and/or paymentverification checks such as verifying the identity of the customer,validating of the financial account identified, by the customer, as thesource of funds from which payments are to be drawn, cross-checkingagainst prohibited customer lists or other types of security checks.

B. A One Step, Method For Instantly Enrolling Customers In A Card-FreeOr Card-Based Modified ACH Payment Processing Or Linked Loyalty Program.Where the customer is able to provide all of the information required,for example, identification information and financial accountinformation, to enroll in a payment process, linked loyalty program orother program offered by a merchant, the enrollment process may becarried out in a relatively expeditious enrollment process hereinafterreferred to as an “instant” enrollment process. Instant enrollment of acustomer may be carried out at a POS such as a check-out lane orregister, or at a store kiosk for enrollment. Instant enrollment of acustomer may also be carried out from a web application on a computer.For example, the customer may input the required information, typically,identification information in the form of a unique identification numberand financial account information required for enrollment in a paymentprocess via a pinpad or other data I/O device located at the POS.Likewise, the financial information may be entered by the customer usingthe pinpad or keyboard, entered manually by a clerk or enteredautomatically, for example, by reading magnetic ink on a blank checkpresented by the customer. Preferably, instant enrollment is carried outin a minimal amount of time, for example, 30 seconds or less, such thatthe enrollment process does not adversely affect the quality of servicefor either the enrolling customer or other customers waiting in linebehind the enrolling customer.

C. A Two Step Method For Enrolling Customers In A Modified ACH PaymentProcessing Or Linked Loyalty Program Suitable For Use With BothCard-Free And Card Based Programs. Where the customer is unable toprovide all of the information required in order to complete enrollmentin a payment process, a linked loyalty program or other program offeredby a merchant, the enrollment may be carried out in two or more steps orseparate sessions. In a first step, the customer provides initialinformation of sufficient detail to permit a later identification of thepartially completed enrollment. Again, the initial information may beprovided using a pinpad or other data I/O device located at a POS orstore kiosk of the merchant. The amount of information initiallyprovided by the customer may vary, but may include identificationinformation, for example, an identification number, suitable for a lateridentification of the partially completed enrollment. Other availableinformation, for example, identification information for one or morefamily members to be included on the account, may also be provided. Uponcompletion of the first step in the enrollment process, the customer maybe provided with an enrollment number that the customer may use inaddition to, or in lieu of, the identification information provided bythe customer during the initial step in the enrollment process. At asubsequent point in time, the customer provides the remainder of thedata required to complete enrollment in another enrollment session. Forexample, the customer may provide the financial account informationnecessary to link a pre-existing enrollment in the merchant's loyaltyprogram to an ACH payment process, thereby enabling the customer to makecard-free purchases of the merchant's goods or services. The customermay complete enrollment by returning to the merchant's premises with therequired information, by calling a designated number and providing therequired information over the telephone, for example, by interactingwith an automated telephone system, or transmitting the requiredinformation over the internet after accessing a secured portion of themerchant's web site. To complete enrollment, the subsequently providedinformation is associated with the initially provided information, forexample, using the enrollment number provided by the merchant during thefirst step of the enrollment process.

D. A Method For Presentation And Acceptance Of Terms And Conditions InAn ACH Payment Or Linked Loyalty Program. During either the instant ortwo-step enrollment of a customer in a program offered by a merchant,for example, a card-free or card-based ACH payment process or linkedloyalty program, various terms and conditions, the acceptance of whichare required to complete enrollment of the customer in the program, maybe electronically presented to the customer, for example, via a displayportion of a pinpad or other data I/O device located at the POS. Inturn, the customer may elect to accept or reject the electronicallypresented terms and conditions, again, for example, via the pinpad orother data I/O device located at the POS. Alternately, presentation andacceptance of the terms and conditions may be made, via a voice and/orkeypad entry in a telephone system, or an internet-accessible userinterface at the merchant's web page. The disclosed method forpresentation and acceptance of terms and conditions is equallyapplicable to card-free programs and to those that require the use of acard.

E. A Card-Free Payment Process Suitable For Use In FinancialTransactions. This process enables a customer to access selectedservices, for example, payment options and/or loyalty program benefits,offered by a merchant. Unlike existing services offered to customers,these and other services may be accessed through use of a uniqueidentifying code which may be easily memorized by the customer. Inaccordance with this process, a customer may make a card-free purchaseof goods or services from a merchant such that the customer is notrequired to present cash or other form of physical tender, for example,a debit card, credit card or loyalty card, provide biometric data usinga uniquely identifiable body part such as a thumb or eye, or operate anelectronic device configured to transmit or otherwise exchange encodedidentifying information with the first merchant in order to complete thepurchase. As a result, the disclosed process is directed to the firsttrue process by which a customer may complete a transaction relyingsolely on mnemonic information.

To complete a transaction, for example, a purchase of selected goodsand/or services for which payment is required, a customer providescertain identifying information to a merchant of the selected goodsand/or services, for example, using a pinpad or other data I/O deviceprovided, by the merchant, at the POS. The provided identifyinginformation, which preferably had been previously committed to memory bythe customer may include: (a) a unique identification number, forexample, telephone number and/or month and day of birth for customer;and (b) an authorization or other type of security code, for example, aPIN. The merchant verifies the provided information, typically, by useof a computerized verification and approval process and, uponverification and approval, the customer may have access to variousservices associated with the card-free payment process, for example,payment options and/or loyalty program benefits associated with thecustomer. Use of the disclosed process is not limited to the specificapplications recited hereinabove. Rather, the process may be extended toa wide variety of financial applications, for example, the deposit offunds in a bank account, as well as non-financial applications, forexample, the admission of a person to secured facilities such asairports.

In accordance with the disclosed payment process, the providedidentifying information may be used to initiate a transfer of fundsequivalent to the price of the goods and/or services being purchased bythe customer. While the funds would most commonly be transferred from asavings or checking account via an ACH debit, it is contemplated thatthe funds may originate from various sources of funds maintained by athird party on behalf of the customer, for example, a credit card orline of credit maintained by a third party on behalf of the customer. Itis further contemplated that the source of the funds may either bepre-selected or selected, at the pinpad or other data I/O deviceprovided at the POS, from any number of choices associated with theprovided identifying information.

Should the customer desire to link the card-free payment process toother offered services, for example, the aforementioned loyalty program,the customer may be able to access or otherwise utilize the linkedservices using the card-free access process hereinabove described. Forexample, by linking a loyalty program to a card-free payment process,the customer could receive benefits associated with the loyalty program,for example, discounts on the purchase of selected goods andsubsequently pay the merchant the discounted amount for the selectedgoods using the ACH debit or other form of payment previously associatedwith the card-free payment process. Whether linked or unlinked, thecard-free payment process provided by the merchant may be coupled toservices offered by any number of other merchants. The other merchantsmay opt to couple their card-free payment process, card-free loyaltyprogram and/or card-free linked loyalty program to the card-free paymentprocess or card-free linked loyalty program offered by the firstmerchant.

F. Method For Distribution Of Tender-based Rewards In A Loyalty Program.This process associates the rewards distributed by participation in aprogram offered by a merchant, for example, a card-based or card-freelinked loyalty program, to the type of tender used by the customer topurchase goods from the merchant. The rewards, if any, issued by themerchant, for example, rebates, discounts and coupons, are distributedbased upon the specific type of tender, for example, ACH debits, bankcredit cards, store credit cards, cash, check, debit card, gift card orelectronic funds transfer offered by the customer. The customer mayoffer the tender in a traditional manner or using a card-based orcard-free linked loyalty program. In turn, the customer may receiveincentives if they choose a preferred form of tender, for example, anACH debit may receive reduced or no incentives if they choose anon-preferred form of tender, for example, a bank credit card thatinvolves transaction fees for the merchant.

The tender-based rewards may be linked to a card-free program such thata customer is rewarded when using functions of the card-free program,for example, access to loyalty program benefits, payment options orcombinations thereof. For example, a customer may be rewarded under alinked loyalty program for using a specific card-free payment type suchas an ACH debit. In addition to, or in lieu of, linking a tender-basedreward to a card-free program, the tender-based reward may be linked toa product-based reward such that a customer is rewarded for purchasing aspecific number, type or combination of products via a specific paymenttype, either traditional or card-free. For, example, a customer may berewarded under a loyalty program for a cumulative purchase of a givennumber of a specific product using a specific card-free payment typesuch as an ACH debit. Such rewards may be cumulative, for example, afirst level of reward for purchasing via an ACH debit and a second levelof reward for card-free access of the ACH debit.

G. A Computer System Suitable For Use In Conjunction With Either An ACHModified Payment Processing Or Linked Loyalty Program. The foregoingprocesses are enabled through use of a computer system configured to (i)authenticate those customers identifying themselves as participants in aprogram, for example, payment processing or linked loyalty programsoffered by a merchant, (ii) authorize the merchant to have access to theinformation required to complete a transaction associated with theprogram and (iii) initiate the transaction itself. Most, but not all,such transactions would be initiated at a POS located on the premises ofthe merchant. The location of the computer system relative to the POSmay vary. For example, the computer system may form part of a remotelylocated control center coupled by a wide area network (WAN) to anynumber of retail stores at which the merchant intends to offer theprogram to customers; a file server, located on the premises for whichthe merchant intends to offer the program, coupled to each POS by alocal area network (LAN), or at each POS itself.

The computer system is comprised of a processor subsystem and a memorysubsystem, coupled to the processor subsystem, for the bi-directionalexchange of address, data and control signals therebetween. The computersystem further includes at least one application which resides in thememory subsystem and is executable by the processor subsystem. Theapplications may include a transaction identification application, anACH transaction application, a loyalty program application or other typeof merchant program transaction application. The transaction applicationdetermines, from data received from the POS, the type of transaction tobe executed by the processor subsystem. Upon identification of the typeof transaction, the transaction identification application transmits thereceived data to the transaction application, for example, the ACHpayment program transaction application or the loyalty programtransaction application, which performs all transactions of theidentified type. The transaction application receiving the data from thetransaction identification application may then execute the transactionand return the results of the transaction to the POS.

To execute, each application is associated with one or more areas of thememory subsystem coupled to the processor subsystem. For example, thetransaction identification application may be coupled to a list oftransaction types; the ACH transaction application may be coupled to alist of authentication codes required to authorize customers attemptingto use the ACH payment processing program and a list of customersenrolled in the ACH payment processing program and the informationrequired by the merchant to execute an ACH transaction for the listedcustomers; and the loyalty program application may be coupled to a listof loyalty program benefits and a list of loyalty program enrollees. Inthe event that the loyalty programs include cumulative benefits, forexample, the issuance of certain rebates upon reaching a pre-selectedlevel of total purchase, the area of memory which maintains the loyaltyprogram enrollees may also maintain cumulative information for all suchenrollees. The applications which execute transactions, for example, theACH transaction application or the loyalty program transactionapplication, execute transactions using the information received fromthe transaction identification application and information read from thememory area associated therewith. As needed in order to complete thetransactions, the transaction applications may transmit information toand receive information from outside computer systems. Where transactionapplications have been linked together, for example, a linked loyaltyprogram incorporating a tender-based rewards program, the ACHtransaction application may be further coupled to the loyalty programapplication so that the ACH transaction application may transmit, to theloyalty program application, the data necessary for the loyalty programapplication to execute the tender-based rewards program.

The foregoing has outlined rather broadly the features and technicaladvantages of the present invention in order that the detaileddescription of the invention that follows may be better understood.Additional features and advantages of the invention will be describedhereinafter that form the subject of the claims of the invention. Itshould be appreciated by those skilled in the art that the specificembodiments disclosed herein may be readily utilized as a basis formodifying or designing other structures for carrying out the samepurposes of the present invention. It should also be realized by thoseskilled in the art that such equivalent constructions do not depart fromthe spirit and scope of the invention as set forth in the appendedclaims.

BRIEF DESCRIPTION OF THE DRAWINGS

For a detailed description of the preferred embodiments of theinvention, reference will now be made to the accompanying drawings inwhich:

FIG. 1 is a flow chart of a method for enrolling in a card-free programoffered by a merchant;

FIG. 2A is a first portion of a flow chart of in-store actions whichoccur in connection with the enrollment of a customer in either amodified ACH payment processing or linked loyalty program offered by amerchant;

FIG. 2B is a second portion of a flow chart of in-store actions whichoccur in connection with the enrollment of the customer in either themodified ACH payment processing or linked loyalty program offered by themerchant;

FIG. 2C is a flow chart of out-of-store actions which occur inconnection with the enrollment of the customer in either the modifiedACH payment processing or linked loyalty program offered by themerchant;

FIG. 2D is an illustrative screen shot of a web enrollment interface forinitiating enrollment in either the modified ACH payment processing orlinked loyalty program;

FIG. 2E is an illustrative screen shot of a web enrollment interface forsoliciting customer information for enrollment in either the modifiedACH payment processing or linked loyalty program;

FIG. 2F is an illustrative screen shot of a web enrollment interface forsoliciting customer financial information for enrollment in either themodified ACH payment processing or linked loyalty program and forsoliciting payment authorization from the customer;

FIG. 2G is an illustrative screen shot of a web enrollment interface fordisplay during verification in the process of enrollment in either themodified ACH payment processing or linked loyalty program;

FIG. 2H is an illustrative screen shot of a web enrollment interface forconfirming customer information for enrollment in either the modifiedACH payment processing or linked loyalty program;

FIG. 2I is an illustrative screen shot of a web enrollment interface forsoliciting customer entry of a unique identification number and PIN forenrollment in either the modified ACH payment processing or linkedloyalty program;

FIG. 2J is an illustrative screen shot of a web enrollment interface forannouncing and confirming successful enrollment in either the modifiedACH payment processing or linked loyalty program;

FIG. 3 is a flow chart of a method for determining whether a customer,enrolling in an ACH payment or linked loyalty program in accordance withthe method of FIG. 1 or FIGS. 2A-C has met a terms and conditionsrequirement for enrolling in that program;

FIG. 4A is a flow chart of a method for card-free payment for goods orservices suitable for use in POS transactions;

FIG. 4B is a flow chart of a method of providing additional benefitssuch as tender-based rewards as part of a card-free payment of goods orservices;

FIG. 5A is a block diagram of a hierarchical computer architecture usedto access information used in modified ACH payment processing or linkedloyalty programs;

FIG. 5B is a block diagram of a computer system for performing modifiedACH payment processing or linked loyalty programs; and

FIG. 5C is a block diagram of computer system for performing modifiedACH payment processing.

DETAILED DESCRIPTION OF THE PREFERRED EMBODIMENTS Definitions

The term “One Step” enrollment refers to instances where the customer isable to provide all of the information required in order to completeenrollment in a single session. The “one step” enrollment may comprise aseries of activities wherein the customer provides the requiredinformation and various verifications occur, all of which occur during asingle session. The single “one step” session may be carried out eitherin a store, such as at a POS or kiosk, or remotely, such as from thecustomer's home computer.

The term “Two Step” enrollment refers to instances where the customer isunable to provide all of the information required in order to completeenrollment in a single session, and the customer is enabled to return tothe enrollment process in a separate session once the informationrequired to complete enrollment is available. The “two step” enrollmentmay comprise a series of activities wherein the customer provides therequired information and various verifications occur, all of which occurduring more than a single session. Specifically, the customer mayprovide some information in a first session, and later return to resumethe enrollment process. The “two step” sessions may be carried outeither in a store, such as at a POS or kiosk, or remotely, such as fromthe customer's home computer, and any combination of in the store orremotely.

The term “in-store,” as used herein, refers to actions which take placeat the premises of the merchant.

The term “out-of-store,” as used herein, refers to actions which takeplace at a remote location, such as at a networked computer in acustomer's home.

The term “instant” enrollment, as used herein, is intended to refer to arelatively expeditious enrollment process. “Instant” enrollment may alsorefer to enrollment that is completed in a single session, without thecustomer returning to resume a previously initiated enrollment. Withinstant enrollment, the customer may immediately begin use of thecard-free payment program and other programs in which he or she hasenrolled instantaneously.

The term “Merchant,” as used herein, refers to a seller of goods orservices. A merchant may maintain its own card-free payment network, ormay contract with a payment program third party to take responsibilityfor card-free payment transactions. Some merchants maintain loyaltyprograms, which may or may not be additionally contracted out to thirdparties.

The term “Payment Program Third Party,” as used herein, refers to athird party that contracts with the Merchant to offer the card-freepayment processes disclosed herein. In various embodiments, merchantsmay be unwilling or unable to support a card-free payment program suchas disclosed herein, and therefore a payment program third party maymaintain and support the processes for enrollment and maintenance ofvarious card-free payment programs for various merchants. In so doing,the payment program third party may necessarily interact with varioussystems controlled by the merchants with whom it contracts, including,for example, loyalty programs. The payment program third party maymaintain a web site for purposes of enrolling customers. The paymentprogram third party may establish its own payment network and loyaltyprogram, such that any time a customer uses the payment program thirdparty's card-free transaction program, the customer receives networkbenefits in addition to, where applicable, any loyalty rewards earnedthrough the merchant's loyalty program.

The term “modified ACH payment” is intended to refer to otherwiseconventional ACH transactions that have been modified on the “front end”but are conventionally configured on the “back end.” In turn, the term“front end” is intended to refer to the process by which a merchantinitiates an ACH transaction requesting the transmission, to themerchant, of funds, in an amount specified by a customer of themerchant, from an account maintained by the customer at a financialinstitution. Conversely, the term “back end” is intended to refer to allother portions of a conventional ACH transaction which occur after themerchant has requested the transmission of funds, in the amountspecified by the customer of the merchant, from the account maintainedby the customer at the financial institution.

An “ACH transaction” refers to a financial transaction processed via thewell-known batch processing, store-and-forward system commonly referredto as the ACH network, which is described in more detail herein.

A “point-of-sale” (POS) refers to a physical location at which a productand/or service may be purchased. Without limitation, examples of a POSinclude a check-out lane in a grocery store or other retailestablishment, a gasoline pump, a kiosk and the like.

A loyalty card refers to a card issued by a merchant that, oftentimes,is associated with information related to the customer, (e.g., name,address, various preferences, and the like). The loyalty card may beassociated with all aspects of a loyalty program offered by themerchant, may be associated with selected aspects of the merchant'sloyalty program, may simply be used as an in-store identification cardor used for other purposes not specifically recited herein.

A loyalty program of a merchant refers to any program in which customersenrolled in the program receive benefits from the merchant. Withoutlimitation, such benefits may be provided in the form of discounts, cashrebates, frequent flyer miles, free products, cash discounts which maybe applied towards future purchases of any items, coupons which may beapplied towards a future purchase of a specified item (or items) andadvertisements.

The term “status” refers to the stage, within the application process,that the customer has reached. The customer is either a new applicantthat has not yet taken any action towards enrollment in either themodified ACH payment processing or linked loyalty program or a pendingapplicant that has taken some actions towards enrollment in theaforementioned programs but has not yet completed the enrollmentprocess.

The term “list” refers to a series of entries, each written to arespective address within the corresponding memory area, comprised of aseries of data bits which describes certain information contained inthat entry. For example, a memory area may be used to describe a programwhich, for example, may be comprised of a description of the membershipin and the benefits provided by the merchant program. In turn, thememory area would include one or more lists, each comprised of a seriesof entries.

I. Enrollment Processes, Generally

A. A Method for Instantly Enrolling Customers in a Card-Free ProgramOffered by a Merchant

Disclosed herein is a method of enrolling a customer in a card-freeprogram offered by a merchant, comprising the customer providinginformation, unique to the customer, for use, by the merchant, inconnection with the card-free program offered by the merchant; andassociating the unique information provided by the customer to at leastone attribute of the card-free program offered by the merchant. A firstone of the at least one attribute of the card-free program offered bythe merchant may be an automated payment process enabling card-freepayment for a purchase of goods or services at a point of sale (POS)using an automated clearing house (ACH) transaction. Alternatively, afirst one of the at least one attribute of the card-free program offeredby the merchant may be an automated loyalty program providing benefitsto the customer in exchange for the customer's patronage of themerchant, and optionally a second one of the at least one attribute ofthe card-free program offered by the merchant may be an automatedpayment process enabling card-free payment for a purchase of goods orservices at a point of sale (POS) using an automated clearing house(ACH) transaction.

The customer providing unique information for use by the merchant inconnection with the card-free program offered by the merchant mayfurther comprise the customer providing first and second subsets ofunique information for use by the merchant in connection with thecard-free program offered by the merchant. The the first subset ofunique information is required for the customer to participate in thecard-free program and the second subset of unique information isrequired for the customer to access the card-free program. The firstsubset of information may be comprised of an identifier of a financialinstitution with which the ACH transaction is to be conducted and anidentifier of an account, maintained by the financial institution fromwhich funds necessary to complete the ACH transaction are to bewithdrawn. The second subset of information may be comprised of firstand second fields, the contents of the first field being pre-determinedprior to the customer initiating enrollment in the card-free programoffered by the merchant and the contents of the second field beingselected, by the customer, during the enrollment process.

Referring to FIG. 1, a method 100 for instantly enrolling a customer ina card-free program offered by a first merchant will now be described ingreater detail. As used herein, the term “instant” enrollment isintended to refer to a relatively expeditious enrollment process. Forexample, enrolling a customer in a program in 30 seconds or less isconsidered to be an instant enrollment. In alternatively embodiments,instant enrollment includes, in the alternatively, enrolling a customerin equal to or less than about 30, 25, 20, 15, or 10 seconds. However,it is specifically contemplated that, while less preferred, enrollmentsrequiring slightly more time, for example, between 45 and 60 seconds,are also considered to be instant enrollments. In its broadest sense, aninstant enrollment is considered to be any enrollment which consumes asufficiently brief period of time such that the enrolling customer, orthose customers waiting in line behind the enrolling customer, considerthe time required to complete the enrollment as a reasonable period ofdelay to be periodically expected while a cashier checks out customers.For example, a brief delay which occurs while a cashier attends to aprice check is a reasonable period of delay which is periodicallyexpected by customers. Typically, instant enrollment of a customer in acard-free program is conducted at a POS, for example, a cash register orcheck-out stand of a store. However, as will be more fully describedbelow, the customer may be enrolled in a card-free program at a widevariety of other locations including a store kiosk or a web applicationaccessed at a network computer. Furthermore, while many enrollmentsrequire only a single session, it is also contemplated that the customermay initiate enrollment in a first enrollment session conducted at afirst location and complete enrollment in a second enrollment sessionconducted at either the first location or a second location differentfrom the first location.

The method 100 of enrolling the customer in a card-free program offeredby a first merchant commences at 102. As disclosed herein, enrollment iscompleted in a single session conducted at the premises of the firstmerchant, for example, at a pinpad or other data input/output (I/O)device located at a POS. It is fully contemplated, however, that variousother locations may be used to initiate enrollment of the customer in acard-free program including remote locations, for example, the home ofthe customer by way of a web application accessed at a networkedcomputer. Similarly, it is also contemplated that other types of dataI/O devices, for example, the telephone or the internet may be used toenroll the customer in the card-free program. At 104, a card-freeprogram, offered by the first merchant, in which the customer wishes toenroll, is identified. For example, the card-free program may be: (a) aloyalty program which provides the customer with rewards, for example,cash discounts, for purchasing goods from the first merchant; (b) acharitable-giving program which transfers a portion of the firstmerchant's profit on the sale of goods to the customer to a designatedcharity; (c) a payment processing program, for example, an automatedclearing house (ACH) payment processing program which automatically paysfor goods or services purchased by the customer; (d) a loyalty programlinked to an ACH or other payment process (linked loyalty program); or(e) a tender-based reward distribution program which provides customerswith rewards, again, for example, cash discounts, based upon the tenderoffered by customers to pay for goods or services being purchasedthereby. The foregoing list is provided by way of example and is notintended to be exhaustive. Accordingly, it is fully contemplated thatthe first merchant may offer a wide variety of card-free programs otherthan those specifically recited herein. If the first merchant offersmultiple card-free programs, a customer may enroll in any number of thecard-free programs offered thereby.

At 106, the customer provides any necessary information required forparticipation in the card-free program. Such information may include,name, address, telephone number, driver's license number and issuingstate, date of birth, social security number, or like identifyinginformation in addition to financial information. This list of types ofinformation is not intended to be exclusive. Certain of the programsoffered by the first merchant may require the customer to providedetailed financial information which should remain confidential whileother programs offered by the first merchant may require the customer toprovide little, if any, confidential information. For example, forparticipation in either ACH payment program or linked loyalty programs,the customer may identify a financial institution and an account throughwhich payment is to be processed. Furthermore, because both ACH paymentand linked loyalty programs involve the transfer of money from achecking or other type of account, some customers may prefer that use ofthe ACH payment or linked loyalty program require the use of a card.Accordingly, although many of the embodiments disclosed herein aredirected to programs configured to function as card-free programs, it isfully contemplated that the configuration of the disclosed programs maybe readily modified so that they function as a card-based program. Thedisclosed programs may be configured to include the distribution ofcards, for example, loyalty cards, and to complete transactions whetheror not the customer presents a card, thereby allow the customer to havethe option of choosing whether to use the card when initiating atransaction. In the foregoing configuration, cards may be distributed toall customers or, in the alternative, only to those customers whoexpress a desire to receive a card.

Having provided the information required to participate in the card-freeprogram offered by the first merchant, the method 100 proceeds to 108where the customer provides identifying information required forsubsequent access to the card-free program for which the customer wishesto participate. Preferably, the identifying information, which isreferred to herein as either an access code or a unique identificationcode, is a number comprised of a series of digits, provided by thecustomer, that is unique to that customer. For ease of use, it is alsopreferred that the access code may either be comprised of, or include asa portion thereof, one or more combinations of digits that the customerhas already committed to memory. For example, home, work and mobiletelephone numbers are all combinations of digits that most customershave already committed to memory. In programs requiring minimalsecurity, the access code required for the customer to subsequentlyaccess the program may be relatively short, for example, a four digitcode. In programs requiring more security, for example, ACH payment andlinked loyalty programs, it is preferred that the access code which isentered for the customer to subsequently access the card-free program becomprised of additional number of digits, including digits which areunique to the customer and digits that are not publicly available. Forexample, it is contemplated that for ACH and linked loyalty programs,the identifying information required to gain subsequent access to theprogram comprises an eighteen digit code, the first ten digits of whichmay be a telephone number of the customer, the next four digits of whichmay be the month and day of birth for the customer and the last fourdigits may be a security code, commonly know as a personalidentification number (PIN), selected by the customer before completingenrollment in the program, for example, by entering the PIN at thepinpad located at the POS during the enrollment process.

Alternatively, it is contemplated that for ACH and linked loyaltyprograms, the identifying information required to gain subsequent accessto the program comprises a nineteen digit code: a five digit bankidentification number (which is appended on to digits provided by thecustomer), ten digits provided by the customer which may be, forexample, the customer's telephone number, a check digit, and a threedigit program code, which may differentiate the type of program in whichthe customer is enrolled. For example, a payment processing program, aloyalty program, and a linked loyalty program may all be offered by themerchant, and the program code indicates to which, of the offeredprograms, the code provides access.

It is fully contemplated that the identifying information required toaccess the card-free program may be any number of digits. Furthermore,the term “digits” is not intended to be limited to the numbers 0-9.Rather, the term encompasses all alphanumeric and/or other charactersand/or symbols, for example, the “#” and “*” keys, that the customer mayenter using the data I/O device provided by the customer. Furthermore,while there is no requirement that the digits be related to personalinformation of the customer, it is believed that, by relating the digitsto the customer in this manner, the customer may be able to commit thedigits to memory with little effort and thereby become more comfortablewith the concept of card-free transactions. Finally, it is fullycontemplated that, when creating the access code, the combination ofdigits which enables subsequent accesses to the card-free program may beentered in any matter, for ease of use, it may be preferable that thecustomer provide the identifying information as a series of answers toquestions appearing on a display portion of the pinpad or other data I/Odevice located at the POS, in a store kiosk or accessed at a networkedcomputer. Conversely, when subsequently accessing the card-free programby entering the identifying information, it is contemplated that theprogram may be configured to accept the identifying information as aseries of answers to questions appearing on the display portion of thepinpad or other data I/O device located at the POS or, in thealternative, as an eighteen or nineteen digit code entered by thecustomer in a sequential manner.

Steps 106 and 108 may be exchanged in their order of execution. Uponproviding the information required for participation in the card-freeprogram of the first merchant at 106 and providing the informationrequired to subsequently access the card-free program of the firstmerchant at 108, the method 100 proceeds to 110 for association of theinformation provided at 106 and 108 to the card-free program offered bythe first merchant. The foregoing association process includes twoassociations—the association of the information required for thecustomer to participate in the program (i.e., customer-specificparticipation data) to the information required for the customer tosubsequently access the program (i.e., customer-specific access data)and the association of the information required for the customer toparticipate in the program (i.e., customer-specific participation data)to the information required to provide the benefits offered as part ofthe program to the customer (i.e., program-specific data). Morespecifically, and as will be more fully described below with respect toFIGS. 5A-C, the first merchant maintains a software application whichoperates the card-free program offered thereby. Likewise, data is storedin a memory, associated with the software application, and maintained bythe first merchant. The information required for participation in thecard-free program is stored in a first area within the memory and theinformation required to subsequently access the card-free program isstored in a second area within the memory. For example, if the card-freeprogram is a software application which attends to payment of a purchaseusing the ACH payment process, the name of the customer, the accountnumber for the account from which the payment is to be drawn and thebank or other financial institution to which the request for funds is tobe directed would be stored in the first area of the memory. Similarly,the information required for accessing the card-free program, forexample, the eighteen digit access code unique to the customer, isstored in the second area of the memory and linked to the correspondinginformation in the first area of the memory containing the informationrequired to perform the requested ACH payment. By associating theparticipation and subsequent access information in this manner, uponsubsequent receipt of an access code and an associated request to accessthe ACH payment process, the ACH payment software application comparesthe received access code to a series of access codes stored in thesecond area of the memory and, if a match is identified, the ACH paymentsoftware application may use the identifying information linked to thematching access code to execute the requested ACH payment.

For card-free programs offered by the merchant which require additionalinformation in order to complete a transaction by a customer, it iscontemplated that the second association, e.g., the association of theinformation required for the customer to participate in the program tothe information necessary for the benefits of the program to be providedto the customer, may also be necessary. For this association, theinformation necessary to provide the benefits of the program to thecustomer may be stored in a third area of the memory. For example, if aloyalty program requires a variable discount based upon the total amountof purchases made by the customer within a pre-selected time frame, thetotal amount of purchases made by the customer (i.e., thecustomer-specific participation data) may be stored in the first area ofthe memory and a list of the dollar value of purchases and associateddiscounts for the program (i.e., the program-specific data) may bestored in the third area of the memory. In this example, upon theloyalty program application confirming the identity of the customer bysuccessfully matching the provided access code to an access code storedin the second area of the memory, the loyalty program application maydetermine the total amount of purchases made by the customer (which, inthis example, would form a portion of the participation information forthe customer) by accessing the information stored in the first area ofthe memory linked to the second area of memory. The loyalty programapplication may then determine the discount to which the customer isentitled by accessing the information stored in the third memory area.The foregoing example of a loyalty program differs slightly from the ACHpayment hereinabove described in that the first area of the memory isperiodically accessed by the loyalty program application to update thetotal amount of purchases made by the customer in the predetermined timeperiod.

The method 100 then continues on to 112 for determination as to whetherthe customer wishes to enroll in additional programs. While, asillustrated herein, the additional programs offered at 112 relate tocard-free programs offered by other merchants, it is fully contemplatedthat the additional programs may instead be additional programs offeredby the first merchant. As disclosed herein, the method 100 issues aninquiry to the customer as to whether enrollment in additional programsis desired by generating a question for display on the pinpad or otherdata I/O device previously used by the customer to provide participationand subsequent access information at 106 and 108, respectively. However,the foregoing process by which inquiries are issued is purely exemplaryand it is fully contemplated that other inquiry techniques may be usedinstead. If enrollment in additional programs is desired, the method 100may then proceed to 122 for determination as to whether the sameparticipation and subsequent access information, specifically theparticipation and subsequent access information provided by the customerat 106 and 108, respectively is to be used to obtain access to andparticipate in the additional program in which the customer wishes toenroll.

If different information is to be used to participate in and/or obtainsubsequent access to the additional program, the method 100 proceeds to124 where the customer provides the additional information required forparticipation in and/or obtain subsequent access to the second card-freeprogram. For example, if the customer possesses a store credit card forthe second merchant, the customer may desire that purchases at the storeoperated by the second merchant be paid by the store credit card. Inthis example, the customer would identify the store credit card as themethod of payment and the account number of the store credit card as theinformation required for participation in the additional program. As theexemplary additional program in which the customer wishes to enrollinvolves a financial transaction, it is contemplated that theinformation provided to subsequently access the program may be anotherhighly secure, unique number such as the aforementioned eighteen digitnumber.

Upon providing the information required for participation in andobtaining subsequent access to the card-free program of a secondmerchant at 124 or upon determining, at 122, that the same informationshall be used when enrolling in the card-free program of the secondmerchant, the method 100 proceeds to 126 where plural informationassociation processes are conducted. Similar to the first associationprocess previously described with respect to the card-free programoffered by the first merchant, the first association process occurringat 126 is the association of the information required for participationin the card-free program offered by the second merchant to theinformation required to subsequently access the card-free programprovided by the second merchant. More specifically, in this, the firstassociation process of 126, either (1) the information required forparticipation in the card-free program of the first merchant provided at106 and the information required to subsequently access the card-freeprogram of the first merchant provided at 108 or (2) the informationrequired for participation in and obtain subsequent access to thecard-free program of the second merchant provided at 124, is associatedwith the card-free program of the second merchant.

In a manner similar to that described with respect to the card-freeprogram of the first merchant, the card-free program of the secondmerchant utilizes a software application and an associated memory forassociation of the information required to participate in the programoffered by the merchant to the information necessary to subsequentlyaccess the program. Also as before, the information required forparticipation in the card-free program of the second merchant is storedin a first area within the memory and the information required tosubsequently access the card-free program of the second merchant isstored in a second area within the memory. Again, the softwareapplication and associated memory will be more fully described withrespect to FIGS. 5A-C. Here, however, the software application which, inconjunction with the associated memory, operates the card-free programmay be maintained by the first merchant, the second merchant orcollectively by the first and second merchants. Of the foregoingoptions, maintenance by the first merchant would be more appropriatewhen the card-free programs of both the first merchant and the secondmerchant utilize the information provided at 106 and 108, maintenance bythe second merchant would be more appropriate when the card-free programof the first merchant utilizes the information provided at 106 and 108and the card-free program of the second merchant utilizes theinformation provided at 124 and maintenance by the first and secondmerchant collectively would be more appropriate when the card-freeprogram of the first merchant utilizes the information provided at 106and 108 while the card-free program of the second merchant uses acombination of all or part of the information provided at 106 and 108and all or part of the information provided at 124.

Alternatively, the software application which operates the card-freepayment program may be maintained by a payment program third party thatcontracts with one or more merchants to provide card-free paymentprocessing. In such embodiments, the payment program third party wouldperiodically synchronize with merchant data, such as loyalty programdata, maintained by the merchant.

Similar to the second association conducted at 110 in connection withthe card-free program offered by the first merchant, for card-freeprograms offered by the second merchant which require additionalinformation in order to complete a transaction by a customer, it iscontemplated that a second association, e.g., the association of theinformation required for the customer to participate in the program tothe information necessary for the benefits of the program to be providedto the customer, may also be necessary. For this association, theinformation necessary to provide the benefits of the program to thecustomer may be stored in a third area of the memory maintained inconnection with the second card-free program.

Finally, the third association to be conducted at 126 is the associationof information related to the card-free program offered by the secondmerchant to information related to the card-free program offered by thefirst merchant. Such an association is necessary whenever pluralsoftware applications are employed, for example, when a first softwareapplication, typically, a software application maintained by the firstmerchant, operates the card-free program offered by the first merchantwhile a second software application, typically, a software applicationmaintained by the second merchant, operates the card-free program of thesecond merchant. In such situations, the respective softwareapplications may be able to exchange information therebetween. Forexample, if a purchase at the POS of the second merchant is to beapplied to the rewards offered by a loyalty program offered by the firstmerchant, the second software application advises the first softwareapplication of the purchase at the POS of the second merchant. While itis contemplated that a wide variety of techniques may be used to conductthe information exchanges between the first and second softwareapplications, one such technique would be for the second softwareapplication write the information needed by the first softwareapplication to a fourth area of the memory associated with the firstsoftware application. The first software application may later use theinformation written to the selected area of memory to update informationmaintained in one of the areas of the memory associated therewith.

Upon determining at 112 that the card-free program offered by the firstmerchant in which the customer has enrolled is not to be affiliated withany card-free programs offered by other merchants or upon completion ofthe association of card-free information used in conjunction withassociation of a card-free program of the second merchant with thecard-free program of the first merchant at 126, the method 100 proceedsto 114 for determination as to whether additional users are to be addedto the card-free program in which the customer is enrolling. If it isdetermined that additional users are to be added, for example, if thedisplay portion of the pinpad or other I/O device generates a query asto whether additional users are to be enrolled in the same account beingcreated for the customer and the customer affirms that additional usersare to be added, for example, by depressing a “yes” button on thepinpad, the method 100 proceeds to step 128 where additional users areadded to the account being created for the customer in the process ofenrolling in the card-free program.

At 128, the customer determines whether the additional users to be addedto his or her account in the card-free program offered by the merchantmay use the same information provided by the customer in connection withtheir participation and/or subsequent access to the card-free programoffered by the merchant. It is contemplated that various benefits mayresult from the use of different information for each user included in asingle account. For example, if different participation information isused for each member of a group to be collectively enrolled, under asingle account, in a card-free linked loyalty program, each user may payfor their goods using their personal checking account while collectivelyaccumulating rewards under the loyalty program. Conversely, if differentaccess information is used for each member of the group being enrolled,the customer may more readily track the usage of the card-free programby each member of the family, business organization or other group to begiven individual access to the account. Furthermore, differentparticipation information for each user allows for disparatefunctionality among users, for example providing access to varying linesof credit or accounts for various users. Also, by using different accessnumbers, each member of the group may be more likely to remember theeighteen digit code with which they are to access the account. Forexample, it is highly likely that the additional users to have access tothe account established by the customer would be able to remember theiraccess code if the code required for them to access the accountconsisted of their own telephone number, month and day of birth andpersonally selected PIN rather than those originally provided by thecustomer at 108.

If it is determined at 128 that personalized information is to beprovided for each additional user of the account in the card-freeprogram being established by the customer, the method 100 proceeds to130 where the participation information and/or subsequent access codesfor the additional users is provided. While it is contemplated that theadditional participation information and/or access codes to be providedfor the additional users may be provided by the customer at the pinpad,it is relatively unlikely that the customer may have the appropriateinformation for each additional user to be added to the account. Thus,provision may be made for adding information for each additional user ata later point in time. For example, the customer may be advised at thePOS or web application for enrollment, again, for example, by a messagegenerated on the display portion of the pinpad that account informationfor the additional users may be provided by accessing or returning to aweb site which permits modification of user information upon entry ofthe previously selected access code. Alternatively, the card-freeprogram may be configured such that, upon a subsequent access of thecard-free program, a reminder that identification information for theadditional users has not yet been provided.

Regardless, after the participation information, access information orboth for each additional user identified during the enrollment of thecustomer in the card-free program offered by the first merchant isprovided at 130 (or, in the alternative, information which enables thecustomer or additional user to provide the participation and/or userinformation at a later date), the method 100 proceeds to 132 where theprovided information for each additional user is associated with thecustomer's account for the card-free program. Apart from the use ofseparate participation and/or access information for each additionaluser, the association between the provided information and the card-freeprogram is similar to that previously described with respect to 110 or126 and need not be described in greater detail herein.

After (1) the customer declines to add additional users to their accountat 114, (2) the customer indicates at 128 that one or more additionalusers for the card-free account are desired and provides information at130 which enables the additional users to participate in the card-freeprogram and access the account established by the customer or (3) thecustomer indicates at 128 that one or more additional users for thecard-free account are desired and that the additional users are to usethe same information as that used by the customer to participate in thecard-free program and access the account established by the customer,the method 100 proceeds to 116 for determination as to whether thecustomer has satisfied the terms and conditions requirement necessary tocomplete enrollment of the customer in the program offered by the firstmerchant. Further details as to the terms and conditions requirementwill be set forth below with respect to FIG. 3 and need not be describedin greater detail herein. At this point, it need only be noted that, ifit is determined at 116 that the customer has failed to meet the termsand conditions requirement, the method 100 proceeds to 134 where thecustomer is informed that enrollment in the program offered by the firstmerchant is rejected. The method 100 would then end at 136.

Returning momentarily to 134, it is contemplated that the first merchantmay employ a variety of avenues to notify the customer that theirapplication for membership in the program offered by the first merchanthas been rejected. For example, when the pinpad located at the POS isused as a data I/O device for the customer to provide information inresponse to queries displayed thereby, the display portion may be usedto generate a variety of rejection messages, for example, “We are unableto process your application at this time.” In the alternative, thedisplay portion may generate an explicit rejection message. Likewise, arejection message or message indicating inability to complete enrollmentmay be displayed in a web application interface. For example, in theforegoing passage in which the customer's application was rejected forfailing to meet the terms and conditions requirement of the customer, arejection message advising that the customer that “Your applicationcannot be accepted until the terms and conditions governing membershipin this program have been accepted.” The display may also display atelephone number to call which the customer may call or an internetaddress which the customer may access to obtain additional informationconcerning the rejection, and such contact information may alternativelyor additionally be provided in hard copy to the customer, for examplevia printout on a POS printer such as a receipt printer. The displayshould also display a rejection code for use by the customer should theyattempt to obtain additional information concerning the rejection. Forexample, when calling to obtain additional information concerning theirrejection, the customer may provide the rejection code to the callcenter attendant handling the call. The attendant may then use therejection code to access the application of the customer and provide thecustomer with the desired information. Alternately, the display maysimply display a reminder that, to obtain additional informationconcerning the rejection of their application, the customer may usetheir access code in the same manner hereinabove described with respectto rejection codes. Finally, the merchant may choose to follow up theinstant rejection provided at the POS with a letter detailing thereasons for the rejection. Whether or not the first merchant generatessuch a letter depends on a variety of factors, for example, whether ornot the first merchant has obtained sufficient information, e.g., amailing address for the customer, to generate a rejection letter and/orwhether the first merchant is legally obligated to send a written letterexplaining the reasons for denying the customer's application forenrollment in the card-free program offered by the first merchant.

Returning to 116, if the customer meets the terms and conditionsrequirement defined by the first merchant for enrolling in the card-freeprogram offered thereby, the method proceeds to 117 for furtherprocessing in the manner set forth below. As to the terms and conditionsrequirement that the customer must meet, depending on the type ofprogram that the customer is seeking to enroll in, the first merchantmay vary the terms and conditions requirement to be satisfied by thecustomer. For example, enrollment in a loyalty program may involve arelatively less restrictive terms and conditions requirement whileenrollment in an ACH payment program may involve a relatively morerestrictive terms and conditions requirement.

At 117, it is determined whether payment verification may be run on thecustomer. The first merchant may configure the method 100 such thatpayment verifications are not run on any customers, paymentverifications are only run on selected customers or paymentverifications are run on all of the customers. If it is decided at 117that the first merchant (a) will not run payment verifications on anycustomers, (b) will only run payment verifications on selected customersand (i) the customer seeking to enroll in the card-free program is notone of the customers selected for payment verification, or (ii) thecustomer seeking to enroll in the card-free program is selected forpayment verification at 117 and passes payment verification at 119, or(c) will run payment verifications on all customers and the customerseeking to enroll in the card-free program passes payment verificationat 119, the method 100 will proceed to 118 for determination as towhether security verification is to be run on the customer. Again, thefirst merchant may variously configure the method 100 such that securityverifications are not run on any customers, security verification areonly run on selected customers or security verifications are run on allcustomers. Here, if it is decided at 118 that the first merchant (a)will not run security verifications on any customers, (b) will only runsecurity verifications on selected customers and (i) the customerseeking to enroll in the card-free program is not one of the customersselected for security verification, or (ii) the customer seeking toenroll in the card-free program is selected for security verification at118 and passes security verification at 120, or (c) will run securityverifications on all customers and the customer seeking to enroll in thecard-free program passes security verification, the customer will beaccepted into the card-free program and the method 100 will proceed to122 for enrollment of the customer in the card-free program.

At 122, the customer is advised of the successful completion ofenrollment in the card-free program offered by the first merchant. Forexample, a first message which welcomes the customer to the program,either alone or in combination with a second message which reminds thecustomer how to subsequently access functions of the card-free program.These messages may appear on the display portion of the pinpad or in theweb application interface. If desired, notification of successfulenrollment in the program may also include written notification of thesuccessful enrollment, together with a reminder how to subsequentlyaccess the card-free program and/or a summary of the benefits ofparticipating in the program. Written notification of successfulenrollment requires that the information required for participation inthe card-free program that was provided by the customer at 106 include amailing address for the customer. Alternatively or additionally, suchwritten notification of successful enrollment may be provided to thecustomer via printout on a POS printer such as a receipt printer.

Generally simultaneously with the notification to the customer of theirsuccessful enrollment in the card-free program offered by the firstmerchant, the account established for the customer may be activated,thereby enabling the customer to participate in the card-free program inwhich they have been successfully enrolled. Preferably, activation maybe immediate, thereby enabling the customer to conduct a transactionduring the same visit. For example, the customer may be able to enrollin the modified ACH payment processing program during a purchase at thePOS and then use the modified ACH payment processing program to pay forthat purchase. In another example, the customer may enroll in themodified ACH payment processing program at a store kiosk upon enteringthe store, and may then use the program to make a purchase during thesame visit to the store. It is contemplated that enrollment of thecustomer in the selected program may be accomplished using a widevariety of techniques. One such technique would be to establish theaforementioned link between the participation information and the accessinformation provided by the customer since, without such a link, thecustomer, even when providing their eighteen digit code, would be unableto initiate an ACH payment or other transaction using the card-freeprogram offered by the first merchant. Alternatively, the entry of theinformation required for participation in the card-free program offeredby the first merchant and provided, by the customer, at 106, may bemarked to indicate that the provided information relates to an activeparticipant in the program. In this case, the card-free programapplication would not utilize the link from the information required tosubsequently access the card-free program to the information requiredfor participation in the card-free program unless the informationrequired for participation in the card-free program had been marked.Finally, after completing enrollment at 122, the method 100 ends at 136.

Returning to 117, if it is determined that the first merchant is to runpayment verification on the customer requesting enrollment in thecard-free program, the method 100 proceeds to 119 for performance of thepayment verification. As previously set forth, the first merchant mayrequire that payment verifications are performed on all customersseeking to enroll in the card-free program offered by the first merchantor on selected ones of the customers seeking to enroll in the card-freeprogram. To ensure that the use of selective payment verification is notapplied improperly, considerable care may be used to determine thecriteria used for identifying which of the customers are to undergopayment verification. For example, the first merchant may determine thatpayment verification may be performed randomly such as on one out ofevery ten customers seeking to enroll in the program offered by thefirst merchant. Another option would be for the merchant to establish aset of criteria for waiving payment verification, for example, thecustomer having been enrolled previously in at least one other programoffered by the first merchant for a pre-determined period of time, thecustomer providing a cash deposit or the customer presenting both adriver's license and a major credit card for inspection by the firstmerchant. The foregoing are provided purely by way of example and it isfully contemplated that a wide variety of other criteria may be used todetermine at 117 whether or not a customer is selected for paymentverification.

Payment verification on either all customers seeking to enroll in thecard-free program or on selected customers seeking to enroll in thecard-free program is conducted at 119. It is contemplated that paymentverification may encompass any number of checks. For example, thepayment verification may encompass a check to determine if the customerhas a record of presenting checks, either to the first merchant or toany merchant, for which payment was refused. Further by way of example,payment verification may include a credit check and a rejection if thecustomer has a Fair Isaac & Co. (FICO) score below a pre-selectedthreshold value. If the customer passes payment verification at 119, themethod 100 may continue on to 118 where, if the first merchant haspreviously determined that all enrolling customers are to undergosecurity verification or, in the alternative, if the enrolling customersatisfies a pre-determined set of criteria for which securityverification is required, the method 100 may then proceed to 120 forsecurity verification. To ensure that the use of selective securityverifications is not applied improperly, considerable care may be usedto determine the criteria used for identifying which of the customersare to undergo security verification. For example, the first merchantmay determine that security verification may be performed randomly suchas one out of every ten customers seeking to enroll in the programoffered by the first merchant. Another option would be for the merchantto establish a set of criteria for waiving security verification, forexample, the customer having been enrolled previously in at least oneother program offered by the first merchant for a pre-determined periodof time or the customer having previously presented a satisfactory formof identification.

If the first merchant determines at 118 that a security verification isto be run on the customer seeking to enroll in a program offered by themerchant because the customer has failed to meet the requirements set bythe first merchant for being exempt from the security verification or ifthe first merchant has previously determined that security checks are tobe performed on all customers seeking to enroll in a program offered bythe merchant, the method 100 proceeds to 120 where the securityverification is performed. Similar to the payment verification of 118,it is again contemplated that the first merchant may pre-select thedesired thoroughness of the security verification. For example, thesecurity verification may encompass a search for outstanding warrantsfor the customer, verification of the identification previouslypresented by the customer during the enrollment process (if applicable),or the initiation of an Office of Foreign Assets Control (OFAC) reviewof the customer. Typically, an OFAC review encompasses checks ofterrorist watch lists, lists of known security risks, lists of knowncriminals and the like. Similarly, a decision as to whether or not thecustomer passes the security verification at 120 may be based upon thedetection of any outstanding warrants, confirmation of the accuracy ofthe identification presented by the customer and/or the receipt offavorable or unfavorable results of the OFAC review of the customer. Theuse of the foregoing factors in reaching a determination as to whether acustomer passes security verification at 120 is purely exemplary and itis fully contemplated that one or more foregoing factors may be omittedwhen deciding whether or not the customer passes security verificationat 120. Conversely, it is fully contemplated that one or more factorsother than those specifically recited herein may be utilized indetermining whether or not the customer passes security verification at120.

Should the customer fail to pass either payment verification at 119 orsecurity verification at 120, the method may again proceed to 134 wherethe customer application for enrollment in the card-free program isrejected. As previously set forth, rejection includes issuance of anin-store rejection and may further include issuance of an out-of-storerejection. Here, however, as a different basis may form the basis usedto deny enrollment of the customer, it may be desired to vary thenotification message delivered to the customer. Conversely, it may bedesired that the notification message for all rejections be the sameregardless of the basis for which enrollment was denied. Having bothrejected the customer's application for enrollment in the card-freeprogram and notified the customer of the rejection at 134, the method100 ends at 136.

The two verifications may take place in any order. Thus, while FIG. 1shows the security verification taking place subsequent to the paymentverification such that only those applicants passing paymentverification will undergo security verification, it is fullycontemplated that, if desired, security verification may be performedfirst and payment verification be performed second such that only thoseapplicants passing security verification will undergo paymentverification. Between the foregoing alternate ordering of payment andsecurity verifications, there is some motivation in selecting theverification expected to result in more rejections to be conducted firstsince, by doing so, the number of verifications performed onsubsequently rejected customers may be minimized. As the performance ofsecurity verifications would also serve the public good, it may bepreferred that security verifications are performed on all customersseeking to enroll in the card-free program, whether such a goal isaccomplished by performing security verifications first or by performingsecurity verifications on all customers, whether or not theysuccessfully pass the payment verification. Finally, while FIG. 1 alsoshows the payment and security verifications 119 and 120 as beingperformed immediately after it is determined that the terms andconditions requirement is met at 116, the payment and securityverifications 119 and 120 may take place at any appropriate point in theenrollment process. For example, the payment and security verificationsmay be conducted immediately after the customer provides the informationrequired for subsequent access to the card-free program at 108. In afurther embodiment thereof, the method 100 includes determining whetherthe customer passes the payment and security verifications at 119 and120 in real time. In further embodiments thereof, any investigationsinto a customer's payment and/or financial history, validation ofidentification presented by a customer, and/or OFAC processing of thecustomer may be performed by the merchant and/or may be outsourced to atleast one outside party.

The foregoing description has been specifically limited to a process forenrolling customers in a card-free program offered by a first merchant.The disclosed enrollment process may be readily modified into a processfor enrolling customers in a second type of program, hereafter referredto as a card-based program, which allows the customer to access theprogram with or without the presentation of a card, typically, a loyaltycard, distributed by the first merchant. Like new enrollees in thecard-free program, a customer enrolling in a card-based program providesboth the information required at 106 for participation in the card-basedprogram as well as the information required at 108 for subsequent accessto the card-based program. To modify the card-free enrollment process toone in which the customer may also access the program using a carddistributed by the first merchant, completion of enrollment at 122 mayfurther include, upon approval of the customer, the distribution of aprogram card such as a loyalty card to the customer. Before distributingthe loyalty card, however, the account number of the loyalty card may bestored in a fifth memory area of the memory associated with thecard-free program application. The account number for the loyalty cardmay then be linked to the subsequent access information for the customerstored in the second memory area. The linked loyalty card may then begiven to the approved customer. The customer may now use the loyaltycard to access the card-free program (which has now been modified into acard-based program). To do so, the customer need only present theloyalty card to the cashier at the POS. Upon receiving the accountnumber associated with the presented loyalty card, the card-free programapplication may compare the received account number with the accountnumbers stored in the fifth memory area and, upon detecting a match,link to the subsequent access information maintained in the secondmemory area. Once the card-free program application has determined thesubsequent access information using the link from the loyalty cardaccount number, the card-free program application may complete acard-based access as if the program offered by the merchant in the samemanner as it would a card-free access of the program, typically, by useof the participation information maintained in the first memory area.

The foregoing description has also been limited to a discussion of theenrollment of customers that have never been previously enrolled in aprogram offered by the first merchant. However, as many retailersalready have loyalty programs in place, provision may be made in theenrollment techniques described hereinabove to address the enrollment ofcurrent loyalty program participants in additional card-free and/orcard-based programs, for example, the modified ACH payment processingprogram described hereinabove. The disclosed enrollment process may alsobe readily modified into a process for enrolling existing participantsin a loyalty program in a second program, for example, a card-freeprogram or a card-based program. Like new enrollees in the card-freeprogram, a customer currently participating in a loyalty program whochooses to enroll in either a card-free or card-based program providesboth the information required at 106 for participation in the card-freeor card-base program as well as the information required at 108 forsubsequent access to the card-free or card-based program (unless theexisting loyalty program maintains the participation and/or subsequentaccess information typically provided by the customer at 106 and 108,respectively). To modify the card-free or card-based enrollment processto one to address those situations in which the customer is already aparticipant in a loyalty program offered by the merchant, completion ofenrollment at 122 may further include, upon approval of the customer, aninquiry as to whether the customer would prefer to convert to acard-free program or to continue using a card-based program. Should thecustomer elect to convert to a card-free program, further modificationof the disclosed process is not required. However, should the customerelect to continue using a card-based program, it may be necessary toeither (a) have the customer surrender their existing loyalty card infavor of a new loyalty card, or (b) associate the account informationfor the existing loyalty card to the subsequent access informationprovided by the customer at 108.

If a new loyalty card is to be provided, before the new loyalty card isgiven to the customer, the account number of the new loyalty card may bestored in a fifth memory area of the memory associated with thecard-free program application. The account number for the loyalty cardmay then be linked to the subsequent access information for the customerstored in the second memory area. Upon establishing the link, the newloyalty card may be given to the approved customer. The customer may nowuse the new loyalty card to access the card-based program. A subsequentusage of the new loyalty card would again initiate a series of actionspreviously described with respect to the card-based program. Conversely,should the customer elect to continue using the existing loyalty card,the account number of the existing loyalty card may be stored in a fifthmemory area of the memory associated with the card-free programapplication. The account number for the existing loyalty card may thenbe linked to the subsequent access information for the customer storedin the second memory area. Upon establishing the link, the customer mayuse the existing loyalty card to access the card-based program. Anysubsequent usage of the existing loyalty card would again initiate aseries of actions previously described with respect to the card-basedprogram.

II. Enrollment Processes, Specifically

Disclosed herein is a method of enrollment of a customer in a paymentprocessing program offered by a merchant or payment program third party,comprising the customer providing, to a first electronic deviceaccessible by a merchant or payment program third party, accessinformation necessary for obtaining access to a source of funds; andgenerally simultaneously with the providing of the access information tothe electronic device accessible to the merchant or payment programthird party, the customer further providing, to the first electronicdevice accessible to the merchant or payment program third party,authorization information required to obtain the access information;wherein the merchant or payment program third party cannot receive theaccess information until the customer has provided the authorizationinformation. The method may further comprise associating the accessinformation provided to the first electronic device with theauthorization information provided to the first electronic device. Theaccess information may be associated with the authorization informationsuch that the access information will be provided to the merchant orpayment program third party upon each receipt, by either the firstelectronic device or a second electronic device coupled to the firstelectronic device, of the authorization information. The authorizationinformation may be comprised of a series of alphanumeric charactersselected by the customer, which may include the telephone number of thecustomer and/or at least part of the birth date of the customer. Forexample, the series of alphanumeric characters may be comprised of afirst sub-series of alphanumeric characters corresponding to thetelephone number of the customer, a second sub-series of alphanumericcharacters corresponding to at least part of the birth date of thecustomer and a third sub-series of alphanumeric characters, said thirdsub-series being a security code selected by the customer. The customermay provide the access information and the authorization information ata point of sale (POS) operated by the merchant. The associating of theaccess information and the authorization information may be performed atthe POS or at a location remote to the POS.

The description set forth hereinabove did not address the variouslocations at which enrollment in a card-free program could be conductedin great detail. Nor did the aforementioned passages address howenrollment may be conducted in plural sessions and how the pluralsessions may be conducted at a single location or at plural locations.Such variations in the method of enrolling in a card-free program willnow be described with respect to FIGS. 2A-C. Enrollment may be completedin either: (a) a single session conducted on the premises of themerchant, for example, at the POS; (b) two or more sessions conducted onthe premises of the merchant; (c) two or more sessions, with an initialsession conducted on the premises of the merchant and a final sessionconducted at a remote location, for example, at a personal computer (PC)located at the home of the customer; (d) two or more sessions, with aninitial session conducted at a remote location and a final sessionconducted on the premises of the merchant; or (e) one or more sessionsconducted at a remote location such as at a computer located at the homeof the customer. For ease of description, however, the methods describedherein are directed to those embodiments in which no more than twosessions are required to complete enrollment of the customer.

For further ease of description, FIGS. 2A-C are segmented between“in-store” actions which take place at the premises of the merchant and“out-of-store” actions which take place at the remote location. Morespecifically, FIGS. 2A-B are directed to in-store actions while FIG. 2Cis directed to out-of-store actions. Even more specifically, variousportions of FIGS. 2A and 2B are directed to: (1) in-store actions whichoccur in connection with an instant (also periodically referred to as a“one-step”) enrollment process which is completed, by the customer, in asingle visit to a store operated by a merchant; (2) in-store actionswhich occur in connection with a two-step enrollment process which isinitiated, by the customer, in a first visit to the store and completedduring a subsequent visit to the same store or to a second storeoperated by the same merchant; (3) in-store actions which occur inconnection with a two-step enrollment process which is initiated duringa visit, by the customer, to the store and completed out-of-store at aremote location; and (4) in-store actions which occur in connection witha two-step enrollment process initiated out-of-store at a remotelocation and completed in-store at a store operated by the merchant. Onthe other hand, various portions of FIG. 2D are directed to: (1)out-of-store actions which occur in connection with a two-stepenrollment process which is initiated, by the customer, in a visit tothe store and completed out-of-store at a remote location; (2)out-of-store actions which occur in connection with a two-stepenrollment process initiated out-of-store at a remote location andcompleted in-store at a store operated by the merchant; and (3)out-of-store actions which occur in connection with a one-step ortwo-step enrollment process initiated and completed at a remotelocation. Finally, it is contemplated that the foregoing enrollmentprocesses may result in a card-free enrollment in which the enrollingcustomer is not issued a loyalty card for subsequent use and/or acard-based enrollment in which the enrolling customer is issued aloyalty card for subsequent use, if desired.

The enrollment processes set forth in FIGS. 2A-C are distinct from thatpreviously described with respect to FIG. 1 in a variety of other ways.First, the processes disclosed in FIGS. 2A-C are directed to thoseprograms requiring a greater amount of information, typically,confidential financial information, from the customer in order for thecustomer to complete enrollment in the program. Further, while the useof a relatively highly secured 18-digit or 19-digit access code to beused by the customer when subsequently accessing the program wasdisclosed in connection with the enrollment process illustrated in FIG.1, it was further disclosed that the use of the eighteen digit accesscode was not always necessary and that relatively lesser secured accesscodes, typically, but not necessarily, access codes employing a lessernumber of digits may be used. In the embodiment disclosed in FIGS. 2A-C,however, it is preferable that highly secured access codes such as thedisclosed eighteen digit or nineteen digit access code be used uniformlysince financial assets of the customer would be exposed to theft orother types of losses in the event that the access code was compromised,for example, if another person came into possession of the code.

The enrollment processes disclosed in FIGS. 2A-C further differ fromthat previously disclosed with respect to FIG. 1 in a number of otherways. Again, in consideration of greater security requirement which maybe provided to enrollment processes involving financial transactions,the enrollment processes disclosed in FIGS. 2A-C require additionalidentification of the customer seeking to enroll. More specifically, inthe enrollment processes to be more fully described herein, theadditional identification required is either a valid driver's license(or other form of government-issued picture ID) and/or a loyalty cardpreviously issued by the merchant. Apart from the need to identify, witha high degree of confidence, the customer seeking to enroll in theprogram, the merchant or payment program third party may have any numberof other reasons for requiring the presentation of a picture IDs and/orexisting loyalty cards from customers seeking to enroll in the programsdisclosed in FIGS. 2A-C. More specifically, in a broad sense, themerchant or payment program third party seeks to enroll as manycustomers as is possible in the program and to conduct those enrollmentsat the POS or at another in-store location. However, the merchant orpayment program third party also seeks to avoid unreasonable delays whenenrolling customers in the program. Accordingly, it is important thatthe merchant or payment program third party acquire as much informationon the customer in the shortest possible time. Typically, membership inan existing loyalty program means that the customer has previouslyfilled out a form with detailed identifying information and, by simplyassociating the information provided by the customer while enrolling inthe new program with the customer's account number for the loyaltyprogram, a significant amount of information on the customer becomesavailable for use in enrolling the customer in the new program in anearly instantaneous manner. Similarly, the driver's license bears basicinformation on the customer, including their name and address, as wellas a license number often used by merchants for identification purposes.The information appearing on the driver's license presented by acustomer enrolling in the new program may be easily recorded forsubsequent use in the enrollment process, particularly for those statesand/or other jurisdictions employing licenses bearing a magnetic stripin which the identifying information is encoded, for example at a POSvia a magnetic strip reader such as those typically associated withpinpads.

As previously set forth, the processes disclosed in FIGS. 2A-C may beused with any type of program offered by the merchant or payment programthird party with little, if any, modification thereof. The disclosedprocesses are particularly well suited for use in conjunction withenrollment in financial programs offered by the merchant or paymentprogram third party, such as card-free modified ACH payment processingprograms and card-free linked loyalty programs. The processes disclosedare also suitable for use in connection with enrollment of the customerin any number of variants of the aforementioned programs. For example,the disclosed enrollment processes are also suitable for use inconnection with card-based modified ACH payment processing programs andcard-based linked loyalty programs.

B. A One-Step, In-Store Method for Instantly Enrolling a Customer in aCard-Free or Card Based Modified ACH Payment Processing or LinkedLoyalty Program

A one-step method by which a customer or other purchaser of goods orservices offered by a merchant instantly enrolls in-store in a modifiedACH payment processing program shall now be described in greater detail.In addition, a one-step method by which a customer instantly enrollsin-store in a linked loyalty program shall also be described in greaterdetail. As used herein, a “linked loyalty program” is a loyalty programlinked to a payment processing program such as a modified ACH paymentprocessing program. In their broadest sense, a customer completes aninstant, in-store enrollment in either of the aforementioned programs byproviding information as to the method of payment, for example, accountinformation for a bank account to be debited, for goods to be purchased,and a unique access code to be associated with the payment information.Using the access code, the customer accesses the associated paymentinformation which, in turn, is used to complete an ACH transaction. Iflinked to a loyalty program, the customer may also receive the benefitsoffered through that loyalty program.

As used herein, the term “modified ACH payment” is intended to refer tootherwise conventional ACH transactions that have been modified on the“front end” but are conventionally configured on the “back end.” Inturn, the term “front end” is intended to refer to the process by whicha merchant or payment program third party initiates an ACH transactionrequesting the transmission, to the merchant, of funds, in an amountspecified by a customer of the merchant, from an account maintained bythe customer at a financial institution. Conversely, the term “back end”is intended to refer to all other portions of a conventional ACHtransaction which occur after the merchant or payment program thirdparty has requested the transmission of finds, in the amount specifiedby the customer of the merchant, from the account maintained by thecustomer at the financial institution. However, the disclosed processesneed not be limited to ACH transactions modified only on the front endthereof. Rather, it is fully contemplated that the disclosed processesmay be configured to further encompass selected portions of the back endof the ACH transaction. In an embodiment, “modified ACH payment” refersto a front end modification whereby the ACH transaction is initiatedwithout the need for a physical tender such as a check or debit cardfrom a customer to a merchant, which may also be referred to herein as acard-free or card-free process. Finally, it should be clearly understoodthat the foregoing description of the disclosed processes in connectionwith an ACH transaction is purely exemplary and it is specificallycontemplated that the techniques disclosed herein are equally suitablewith payment processes other than the particular one disclosed herein.

As further used herein, an “ACH transaction” refers to a financialtransaction processed via the well-known batch processing,store-and-forward system commonly referred to as the ACH network, whichis described in more detail herein. A “point-of-sale” (POS) refers to aphysical location at which a product and/or service may be purchased.Without limitation, examples of a POS include a check-out lane in agrocery store or other retail establishment, a gasoline pump, a kioskand the like. In an embodiment, a POS may also encompass web servers,automated voice processing systems and other devices and/or systemswhich enable consumers to make purchases or conduct other financialtransactions without any direct physical interaction with the merchantand/or devices maintained by the merchant. A “merchant” may be anyindividual, group of individuals, or business entity of any forminvolved in the sale of goods and/or services to consumers or othermerchants. Without limitation, examples of merchants includesupermarkets, clothing stores, gas stations, retailers, and the like.

Turning now to FIGS. 2A-B, the various in-store actions which occur inconnection with a one-step, in-store method of instantly enrolling acustomer in either a modified ACH payment processing program or a linkedloyalty program offered by a merchant will now be described. In thisregard, a customer initiating the enrollment process may not seek toenroll in one of the aforementioned programs in favor of the other.Rather, selections made by the customer during the enrollment processmay determine whether the customer is enrolled in the modified ACHpayment processing program or the linked loyalty program. Similarly, acustomer initiating the enrollment process may not designate whetherthey wish to be enrolled in a card-free or card-based program. Rather,selections made by the customer during the enrollment process maydetermine whether the customer is enrolled in a card-free or card-basedprogram.

Importantly, and as will be more fully described below, in the methodsdescribed herein, the customer presents a check or other type ofacceptable financial information in order to complete a one-step,in-store enrollment in either the modified ACH processing or the linkedloyalty program. If desired, the in-store one-step enrollment may becompleted in real time and/or as part of a purchase or other transactionbetween the merchant and the customer. In an embodiment, the one-step,in-store enrollment is an instant enrollment as defined herein. Toenroll, the customer shall be asked to present either: (1) a form ofidentification, typically, a government-issued picture ID; or (2) aloyalty card; in combination with (3) a check or other type of financialinformation, preferably documented information, identifying thearrangement to be used to compensate the merchant for the goods and/orservices to be purchased by the customer.

Preferably, presentation of an acceptable form of identification is aprerequisite to enrollment in either the modified ACH payment processingor the linked loyalty program. This includes both the one-step method ofinstantly enrolling in the modified ACH payment processing or linkedloyalty programs described herein as well as the two-step methods to besubsequently described. The form of identification may be anyidentification generally recognized by the business community as beingsuitable for proving the identity of the person presenting theidentification. Without limitation, examples of suitable forms which acustomer may present include a driver's license, a militaryidentification card, passport, or other government issued identificationdocument. While it is contemplated that, in certain embodiments, thepresentation of an acceptable form of identification may not berequired, such embodiment are generally not preferable due to any numberof shortcomings, for example, an unusually high risk of fraud.

Nor is presentation of a loyalty card considered to be a prerequisite toenrollment in the modified ACH payment processing or linked loyaltyprograms. Broadly speaking, a loyalty card refers to a card issued by amerchant that, oftentimes, is associated with information related to thecustomer, (e.g., name, address, various preferences, and the like). Theloyalty card may be associated with all aspects of a loyalty programoffered by the merchant, may be associated with selected aspects of themerchant's loyalty program, may simply be used as an in-storeidentification card or used for other purposes not specifically recitedherein. In embodiments in which the customer had not been previouslyenrolled in the merchant's loyalty program, enrollment in the modifiedACH payment processing program may also result in the enrollment of thecustomer in the loyalty program. It is to be understood that a loyaltyprogram of a merchant refers to any program in which customers enrolledin the program receive benefits from the merchant. Without limitation,such benefits may be provided in the form of discounts, cash rebates,frequent flyer miles, free products, cash discounts which may be appliedtowards future purchases of any items, coupons which may be appliedtowards a future purchase of a specified item (or items) andadvertisements. The loyalty card may be associated with a singlemerchant or, if desired, with plural merchants. If associated withplural merchants, the loyalty card may provide benefits from one or moreof the participating merchants. The loyalty program may also includeacceptance of the loyalty card as sufficient proof of identificationwhen paying by check. The use of the loyalty card as a form ofidentification is generally not preferable because they may more readilybe used in a fraudulent manner. This is particularly true for merchantswho freely distribute the loyalty cards with little, if any, concernthat the recipient has properly identified themselves to the merchantwhen they request the loyalty card.

If a check is used by the customer to identify the financial arrangementfor subsequent compensations of the merchant, the check may be any checkthat is issued by a bank, credit union or other financial institutionand used to draw on a checking account, savings account, credit card,line of credit or other type of asset used by the customer to draw fundson request. The check may be issued in the name of the customer, one ormore other responsible parties, or any combination thereof. In someembodiments, the check is voided to provide security to the customer.Other types of information which may be used to identify the arrangementto be used to compensate the merchant include, without limitation, adebit card which identifies a financial institution and an account fromwhich the identified financial institution will draw funds in accordancewith a pre-existing agreement with the customer or other responsibleparty and/or a credit card which identifies a financial institution thatwill advance funds to the customer in accordance with a pre-existingloan agreement with the customer. If the customer does not present acheck or other type of instrument, e.g., a debit card, which relies uponthe modified ACH payment processing program to reimburse the merchant,the payment processing program to be more fully described below may bemodified to take into account the alternate payment process employed inplace of the modified ACH payment processing program. For example, acredit card is one type of instrument that does not rely upon themodified ACH payment processing program to reimburse the merchant.Additionally, a line of credit offered by either the merchant or thepayment program third party may be yet another type of instrument thatmay be used to reimburse the merchant.

Turning now to FIG. 2A, a one-step, in-store method 200 for instantlyenrolling customers in either a modified ACH payment processing or alinked loyalty program offered by a merchant commences at 201 and, at202, the status of the customer seeking to enroll in one of theaforementioned programs is determined. As used herein, the term “status”refers to the stage, within the application process, that the customerhas reached. The customer is either a new applicant that has not yettaken any action towards enrollment in either the modified ACH paymentprocessing or linked loyalty program or a pending applicant that hastaken some actions towards enrollment in the aforementioned programs buthas not yet completed the enrollment process. Accordingly, if it isdetermined at 202 that the customer is a new applicant, for example, thecustomer answers affirmatively when asked, at the POS, whether theywould like to enroll in either the modified ACH payment processing orlinked loyalty programs, the method 200 proceeds to 203. If, on theother hand, the customer is a pending applicant, for example, thecustomer presents themselves at the POS and requests that theirenrollment in either the modified ACH payment processing or linkedloyalty program be completed, then the customer is enrolling in one ofthe aforementioned programs using a two-step enrollment process to bemore fully described below.

At 203, the customer seeking to enroll in either the modified ACHpayment processing or linked loyalty program presents identification atthe POS, typically, to an employee or other representative of themerchant responsible for in-store enrollment of customers patronizingthe store or other facility operated by the merchant. Continuing on to204, the customer's identification is matched to the customer. Forexample, the employee visually matches a photograph and name appearingon the presented identification to the physical appearance of thecustomer. If the presented identification matches the customer, thepresented identification is accepted, and the method 200 proceeds to 209for further processing of the application in a manner to be more fullydescribed below. If, however, if it is determined at 204 that thepresented identification does not match the customer, an in-storerejection of the customer is issued at 205, typically, by the employeeadvising the customer that enrollment in either the modified ACH paymentprocessing program or linked loyalty program cannot be processed withoutsuitable identification. The method 200 then proceeds to 206 where anout-of-store rejection is issued to the customer. For example, themerchant may generate a written letter to the customer which advises thecustomer that enrollment in either the modified ACH payment processingor linked loyalty program has been denied. The out-of-store rejectionmay not be possible if the merchant lacks the name and address of thecustomer. Alternatively, the merchant may issue an in-store, writtenrejection, for example via a POS printer such as a receipt printer.Furthermore, the merchant may elect to issue written and/or out-of-storerejections only when required by law. Having issued an in-storerejection at 205 and optionally an out-of-store rejection to thecustomer at 206, the method 200 proceeds to 208 where processing of thecustomer's application to enroll in either the modified ACH payment orlinked loyalty program is complete.

Returning to 204, if the presented ID is verified, again, for example,by visually matching the photograph appearing on the presentedidentification to the physical appearance of the customer, the method200 proceeds to 209 for a determination as to whether the customer is acurrent member of the merchant's loyalty program. To do so, the employeemay inquire as to whether the customer has a loyalty card or, if theloyalty program is a card-free program, if the customer is a participantin the loyalty program. If the customer answers affirmatively and (1)presents a loyalty card bearing their membership number, (2) statestheir membership number, or (3) provides a reference number, forexample, their telephone number, previously associated with theirmembership number, the method 200 proceeds from 209 to 210 where, if thecustomer's loyalty card is both available and readable, informationrelated to the customer associated with the loyalty card is read for usein connection with enrollment of the customer in the linked loyaltyprogram. While the amount of information related to the customeravailable for use in the enrollment process may vary based upon theamount of information collected at the time of enrollment in the loyaltyprogram, at an absolute minimum, the membership number associated withthe loyalty card possessed by the customer may be provided. It iscontemplated that the information related to the customer may betransferred using a variety of techniques. For example, the presentedloyalty card may be scanned using a handheld optical reader or swipedthrough a magnetic reader. If, on the other hand, the loyalty card isnot available for presentation or if the loyalty card is a relativelyunsophisticated card on which the reference number is manually printedor otherwise transcribed, the method 200 proceeds to 211 where themembership number may be input into a pin pad or other suitable datainput/output (I/O) device deployed at the POS by the merchant. It iscontemplated that either the customer or the employee may physicallyinput the account number at 211.

Similarly, in embodiments where the customer is not carrying theirloyalty card or where the merchant employs a card-free loyalty program,the customer may either provide the cashier with their membership numberfor entry into the pinpad or enter the membership number into the pinpadthemselves. As many people find it difficult to remember theirmembership number for a loyalty program, particularly when the loyaltyprogram has a large number of participants and the membership numbersbecome quite long, as previously set forth, the membership number for acustomer participating in the loyalty program may be associated with areference number that is relatively easy for a customer to remember. Byway of example, a loyalty program may elect to associate the membershipnumber for a participant with their telephone number.

Upon reading or otherwise receiving the membership number of thecustomer seeking to enroll in the linked loyalty program, a verificationis performed, also as part of 210 (if the card is both available andreadable) or 211 (if the account number is manually provided). If themembership number read at 210 is verified as being associated with acustomer participating in the loyalty program, the enrollment processcontinues at 212 for further processing in a manner to be more fullydescribed below. If, however, the verification at 210 indicates that themembership number was not successfully read (e.g., the magnetic bar codeis not operable), was successfully read but subsequently denied (e.g.,the received membership number does not correspond to the membershipnumber for a participant in the loyalty program), the method proceeds to211 for manual input of the membership number in accordance in themanner previously set forth. Similarly, if the verification at 211indicates that the manually entered membership number was improperlyentered (e.g., the customer or employee enters an incorrect membershipnumber) or was properly entered but subsequently denied, the membershipnumber may, if desired, be entered manually a second time, again, aspart of 211. If the membership number entered manually at 211 for eitherthe first or second time is verified as being associated with a customerparticipating in the loyalty program, the enrollment process continuesat 212 for further processing in a manner to be more fully describedbelow. If, however, the membership number is not verified, the methodmay instead proceed to 205 for issuance of an in-store rejection, anoptional out-of store rejection at 206, and completion of the enrollmentprocess at 208. Here, however, the in-store and/or out-of-storerejections may vary from that previously described. More specifically,in response to a failure to verify the customer's membership in theloyalty program, the customer may be advised of the verificationfailure, for example, by generating a failure message in a displayportion of the pinpad used to enter the membership number. Upon learningof the verification failure, the employee may then inquire if thecustomer would like to continue enrollment in either the modified ACHpayment processing or linked loyalty program as a non-member in theloyalty program. If so, the method would proceed to 212 for furtherprocessing in a manner to be more fully described below. If the customerdeclines to continue enrollment as a non-member in the loyalty program,however, the rejection process may proceed in the manner previously setforth.

Upon an indication, by the customer, that they are not a member of theloyalty program at 209 or upon verification of membership in the loyaltyprogram at either 210 or 211, the method 200 proceeds to 212 where thecustomer's payment system information is captured, for example thecustomer presents a blank check to the employee. If desired, thecustomer may elect to void the check before presenting it to theemployee. If the customer has a blank check for presentation to thecashier, the enrollment process proceeds to 213 for further in-storeprocessing of the one-step, in-store instant enrollment in either themodified ACH payment processing program or the linked loyalty program.If, however, it is determined at 212 that the customer does not have ablank check for presentation to the cashier, the one-step, in-storeinstant enrollment process converts into one of plural two-stepenrollment processes and proceeds to 224 where the two step enrollmentof the customer continues in a manner to be more fully described below.

Returning to 213, upon presentment of the blank or voided blank check,the presented check is scanned or otherwise read, for example, using anoptical scanner or magnetic ink reader, and the routing number andaccount number imprinted on the presented check is captured. It is to beunderstood that 212 and 213 are not limited to checks but may insteadencompass other payment systems or methods by which payment may be madefrom the customer's account. For example, the customer may elect for analternate method of payment and instead present a debit or charge cardto the employee. If, however, the alternate method of payment elected bythe customer involves a payment process which does not incorporate anACH transaction, the process by which the merchant is reimbursed forpurchases made by the customer may be modified correspondingly.

If the banking information captured from the presented check at 213 isacceptable, for example, if the presented check was successfully readand the desired information successfully captured therefrom, the method200 proceeds to 215 where the customer provides a unique identificationcode. In addition to a simple confirmation that a routing number andaccount number were captured from the presented check, it iscontemplated that a determination at 213 that the banking informationcaptured from the presented check is acceptable may also includeconfirmation that the captured routing number corresponds to a financialinstitution; confirmation that the captured account number correspondsto an account maintained by the financial institution in the name of thecustomer; an investigation to determine whether the customer has eitheroutstanding checks that the financial institution has refused paymentand/or the customer has “bounced” a pre-determined number of checkswithin in a pre-determined time period; or combinations thereof.

Returning to 215, it is noted that the unique identification code ofeach customer enrolling in either the modified ACH payment processing orlinked loyalty program offered by the merchant is to be different fromthe unique identification code of every other enrollee. While describedherein as being comprised of a number having a pre-determined length, itis fully contemplated that the unique identification code may becomprised of any combination of letters, numbers and/or symbols whichappear on the pinpad or other I/O device deployed at the POS. The uniqueidentification code may be input, by the customer, by any suitablemethod, for example, using the pinpad deployed by the merchant at thePOS. In one embodiment, the unique identification code is a six digitnumber comprised of the month, day, and year of the customer's birthprovided that no duplicates are allowed. In another embodiment, theunique identification code is comprised of a ten digit number comprisedof the customer's telephone number. In still another embodiment, theunique identification code is a fourteen digit number comprised of thecustomer's telephone number and the month and day of the customer'sbirth.

At 216, the identification code provided by the customer is verified asunique. The verification may be accomplished by any suitable method. Forexample, it may be accomplished by electronically checking a data storemaintaining the unique identification numbers of enrollees in either themodified ACH payment processing or linked loyalty program and if a matchbetween the provided identification code and an existing uniqueidentification code is found, the provided identification code isclassified as “not unique” and the method 200 returns to 215 forselection of another identification code. Telephone numbers may beconsidered to be unique. Accordingly, if an identification codecontaining a telephone number is classified as “not unique”, such adetermination is likely the result of an incorrectly entered telephonenumber. Accordingly, to avoid such errors, it may be desirable toprovide a confirmation process where, to avoid the entry of an erroneousidentification number, the identification number is entered twice.Conversely, the failure to find such a match results in the providedidentification code being classified as “unique” and the method proceedsto 217 for further processing. In an alternative embodiment, themerchant provides the unique identification code. By doing so, themerchant ensures that the provided identification code is unique.

At 217, the customer selects a security code, commonly known in the artas a PIN. As before, the PIN may be entered by the customer using thepinpad or other I/O device located at a POS. The PIN may be any numberof letters, numbers or other symbols which may be selected using a datainput portion of the pinpad. For example, a PIN may be comprised of afour to six digit number. In certain embodiments, the PIN may bere-entered by the customer, again to ensure, that no mistakes (e.g., oneor more mistyped characters) occurred during the entry thereof. In oneembodiment, the PIN is verified as unique. For instance, a database ofPINs may be maintained in a data store and each PIN selected by acustomer is checked against the database. In this embodiment, if theselected PIN is not unique, the customer may be prompted to select a newPIN. In another embodiment, there is no requirement that the PIN beunique. Here, the unique identification code previously provided by thecustomer ensures that each and every customer enrolled in either themodified ACH payment processing or linked loyalty program may beuniquely identified. After the customer enters the PIN, it is appendedto the unique identification code such that knowledge of both numbers isrequired for the customer to subsequently access either the modified ACHpayment processing or linked loyalty program. For ease of description,after the PIN is appended to the unique identification code, thecombination is hereinafter referred to as a unique extendedidentification code.

Upon selection of a PIN number and subsequent generation of a uniqueextended identification code at 217, the method 200 proceeds to 218 fordetermination as to whether the customer has satisfied the terms andconditions requirement necessary to complete enrollment of the customerin either the modified ACH payment processing or linked loyalty programoffered by the merchant. Further details as to the terms and conditionsrequirement set by the merchant may be set forth below with respect toFIG. 3, below. At this point, it need only be noted that, if it isdetermined at 218 that the customer has failed to meet the terms andconditions requirement set by the merchant, the method 200 proceeds to205 for further processing in the manner previously set forth. Thus, ifthe customer does not satisfy the terms and conditions requirement setby the merchant, an in-store rejection is generated at 205, an optionalout-of-store rejection may be generated at 206, and the enrollmentprocess concludes at 208. Here, however, the in-store and/orout-of-store rejections may advise the customer that rejection is aresult of the customer's failure to meet the terms and conditionsrequirement, set by the merchant, for either the modified ACH paymentprocessing or linked loyalty program. Conversely, if the customersatisfies the terms and conditions requirement at 218, the method 200proceeds to 219 for one or more verifications which may be requiredprior to completing enrollment in either the modified ACH paymentprocessing or linked loyalty program.

More specifically, at 219, the customer undergoes payment verificationand, at 220, security verification. As before, should the customer failto pass either of these verifications, the method would again proceed to205 for issuance of an in-store rejection, 206 for an optional issuanceof an out-of-store rejection, and 208 for completion of the enrollmentprocess. As before, the in-store and/or out-of-store rejections at 205and/or 206, respectively, may include either a generic rejectionmessage, for example, “Sorry, but we are unable to approve yourapplication at this time” or a specific rejection message stating thereason for the rejection. The verifications take place in any order.Thus, while FIG. 2A shows the security verification taking place aftercompletion of the payment verification, it is fully contemplated that,if desired, the security verification may be performed before thepayment verification. Further, it is noted that FIG. 2A also shows thepayment and security verifications at 219 and 220, respectively, asbeing performed immediately after the terms and conditions requirementis met at 218. The payment and security verifications at 219 and 220,respectively, may be performed at any appropriate point in the method200. For example, the method 200 illustrated in FIG. 2A includes adetermination at 213 as to the acceptability of the captured bankinginformation. However, it is fully contemplated that the paymentverification described herein may be executed in place of the, orimmediately subsequent to, the banking information acceptabilitydetermination at 213. If configured in this manner, the bankinginformation acceptability determination would serve as a preliminaryreview of the financial suitability of the customer seeking enrollmentin either the modified ACH payment processing or linked loyalty programwhile the payment verification would serve as a final review of thefinancial suitability of the customer. Similarly, the securityverification conducted at 220 may be executed in place of, orimmediately subsequent to, the ID verification at 204. If configured inthis manner, the ID verification would serve as a preliminary review ofwhether there are any non-financial considerations to be taken intoaccount in the decision as to whether or not to allow the customer toenroll in either the modified ACH payment processing or linked loyaltyprogram while the security verification would serve as a final review asto whether there are any non-financial considerations to be taken intoaccount in the decision as to whether or not to allow the customer toenroll in either the modified ACH payment processing or linked loyaltyprogram.

It is contemplated that payment verification at 219 may encompass anynumber of types of financial reviews of the customer. Withoutlimitation, a decision as to whether or not the customer passes paymentverification test at 219 may be based upon a review of financialinformation (including both information related to the account to beused for payment in an ACH transaction as well as information related tothe overall financial health of the customer). For example, it iscontemplated that a customer may fail payment verification at 219 if theprovided financial information includes: (1) a routing number whichfails to correspond to any financial institution; (2) an account numberwhich fails to correspond to any account at the identified financialinstitution; (3) an account number of an account for which the customerlacks authority to withdraw funds; (4) an account number of an accountfor which a specified level of cash reserves has not been maintained fora specified period of time; or (5) an account number of an account thatis frequently overdrawn. The foregoing are provided purely by way ofexample and it is fully contemplated that any number of these and/orother financial considerations not specifically recited herein may beutilized when establishing the criteria used to determine whether acustomer passes or fails the payment verification at 219. In order toprovide a definitive answer as to whether the customer's application forenrollment in either the modified ACH payment processing or linkedloyalty program may be accepted, it is often preferable that the paymentverification at 219 be conducted in real time, thereby ensuring that adecision on the customer's application may be provided in a timelymanner. It is contemplated that the payment verification conducted at219 may be performed by the merchant and/or be outsourced to one or moreoutside parties.

Similarly, a decision as to whether or not the customer passes thesecurity verification at 220 may be based upon any number of criteria,for example, (1) the degree of confidence to which the identificationinformation provided by the customer can be verified, (2) whether theresults of an OFAC review of the customer were favorable or unfavorable,(3) whether the customer appears on any watch lists, for example,terrorist watch lists, (4) whether the customer has ever been arrestedor convicted for shoplifting or for passing bad or no account checks, or(5) whether the customer has a history of violence, drug or alcoholaddiction and/or mental instability. The foregoing are provided purelyby way of example and it is fully contemplated that any number of theseand/or other non-financial considerations not specifically recitedherein may be utilized when establishing the criteria used to determinewhether a customer passes or fails the security verification at 220.Again, in order to provide a definitive answer as to whether thecustomer's application for enrollment in either the modified ACH paymentprocessing or linked loyalty program may be accepted, it is oftenpreferable that the security verification at 220 be conducted in realtime, thereby ensuring that a decision on the customer's application maybe provided in a timely manner. It is contemplated that the securityverification conducted at 220 may be performed by the merchant and/or beoutsourced to one or more outside parties. As opposed to the paymentverification conducted at 219, the scope and nature of the securityverification conducted at 220 makes it much more likely that a thirdparty may have access to the resources necessary to properly conduct thesecurity verification.

If the customer passes payment verification at 219 and securityverification at 220, the method 200 proceeds to 221 for determination asto whether the customer is a current participant in the loyalty programoffered by the merchant. As this is the same test that was previouslyperformed at 209, it is contemplated that the prior determination as towhether the customer is a current participant in the loyalty program maybe reused at 221. Having (a) met the requirements (verifiableidentification, verifiable payment information and creation of a uniqueextended identification code) for conducting ACH transactions throughone of the programs offered by the merchant; (b) been confirmed as acurrent participant in the merchant's loyalty program; and (c)established a first link between their membership number for the loyaltyprogram and their unique extended identification code and a second linkbetween their unique extended identification code and their paymentinformation as described previously, the customer is formally enrolledin the linked loyalty program offered by the merchant at 221, therebycompleting the method 200 at 208.

If, however, it is determined at 221 that the customer is not aparticipant in the loyalty program, the method 200 proceeds to 222 fordetermination as to whether the customer wishes to enroll in the loyaltyprogram. For example, as previously set forth, the employee may ask thecustomer whether or not they are a member of the loyalty program at 209.If the customer answers in the negative, the employee may then ask ifthe customer wishes to enroll in the loyalty program as part of theirenrollment in either the modified ACH payment processing or linkedloyalty program. The method 200 may use the information thusly acquiredat 209 to determine at 222 whether the customer wishes to enroll in theloyalty program. If the customer wishes to enroll in the loyaltyprogram, the method 200 proceeds to 207 where the customer is enrolledin the program, typically, by assigning a membership number to thecustomer and linking the assigned membership number to the uniqueextended identification code. Having (a) met the requirements(verifiable identification, verifiable payment information and creationof a unique extended identification code) for conducting ACHtransactions through one of the programs offered by the merchant; (b)enrolled in the merchant's loyalty program; and (c) having established afirst link between their membership number for the loyalty program andtheir unique extended identification code and a second link betweentheir unique extended identification code and their payment informationas described previously, the customer is formally enrolled in the linkedloyalty program offered by the merchant at 207, thereby completing themethod 200 at 208.

Returning to 222, if it is instead determined that the customer does notwish to enroll in the loyalty program, for example, the customer statedat 209 that they only wanted to be able to conduct ACH transactions andwere not interested in enrolling in the loyalty program, the method 200would proceed, from 222, to 208 where, having (a) met the requirements(verifiable identification, verifiable payment information and creationof a unique extended identification code) for conducting ACHtransactions through one of the programs offered by the merchant, (b)declined membership in the merchant's loyalty program and (c) havingestablished a link between their unique extended identification code andtheir payment information as described previously, the customer isformally enrolled in the modified ACH payment processing program offeredby the merchant, thereby completing the method 200 at 208.

The foregoing is a description of a one step, in-store method forinstantly enrolling a customer in either a modified ACH paymentprocessing or linked loyalty program offered by a merchant. In anembodiment, such modified ACH payment processing and/or linked loyaltyprograms are card-free programs, card-based programs, or both asdescribed herein. While there is any number of other methods ofenrolling in either the modified ACH payment processing or linkedloyalty program described herein, such methods are generallycharacterized as two-step methods in which enrollment cannot becompleted instantly. While, as a whole, such other methods cannot becompleted instantly, certain portions of those methods can be completedinstantly.

The foregoing method has been identified as being suitable for use ineither a card-free or card-based linked loyalty program. When used in acard-free linked loyalty program, the customer would provide theirunique extended identification code, for example, by entering the uniqueextended identification code into a pinpad deployed or other I/O deviceat a POS. Using the link between the unique extended identification codeand the customer's financial information, the financial information maybe accessed so that an ACH transaction may be initiated. The linkbetween the unique extended identification code and customer'smembership number in the loyalty program enables the customer to receivethe benefits associated with their participation in the loyalty program.Specifically, the identified membership number would be confirmed asbeing assigned to a participant in the loyalty program and a linkbetween the identified membership number and the benefits associatedwith that membership number would enable the appropriate benefits to beprovided to the customer. Conversely, in a card-based linked loyaltyprogram, the customer is able to conduct transactions with or withoutthe use of the loyalty card in their possession. Without the loyaltycard, transactions would be conducted in the manner hereinabovedescribed with respect to the card-free linked loyalty program. If thecustomer elects to present the loyalty card at the POS, their membershipnumber would be confirmed as a membership number assigned to aparticipant in the loyalty program and a link between the membershipnumber and the benefits associated with that membership number wouldenable the customer to receive the benefits associated with theirparticipation in the loyalty program. The link between the membershipnumber and the unique extended identification code and the correspondinglink between the unique extended identification code and the financialinformation of the customer may then be used to initiate the ACHtransaction.

C. Two Step Method for Enrolling Customers in an ACH Modified PaymentProcessing or Linked Loyalty Program Suitable for Use with BothCard-Free and Card-Based Programs

In the foregoing passages, a one step method for instantly enrolling ineither a modified ACH payment processing or linked loyalty programoffered by a merchant was described in detail. Having described the onestep method, various two step methods shall now be described. While eachof the two step methods differs from the others in one or more respects,they all share certain common features. Specifically, for all two stepenrollment methods disclosed herein, the customer performs the firststep at a first point in time and the second step at a second point intime. Furthermore, the first and second steps are performed at first andsecond locations. At least one, but possibly all, of the steps may beperformed in-store. If desired, at least one, but not all, of the stepsmay be performed out-of-store, i.e., at a remote location, for example,the home of the customer seeking to enroll in the modified ACH paymentprocessing or linked loyalty programs.

C-1 A First Step In-Store/Second Step Out-Of-Store Enrollment Process

The first step in-store/second step out-of-store enrollment process willnow be described in greater detail, again, with reference to FIG. 2A. Inthe description to follow, the first step in-store/second stepout-of-store enrollment process is also periodically referred to as thecheck-less enrollment process because the customer lacks, typicallyinadvertently, a blank check (the typical instrument used to provide therequisite financial information to the merchant) when first initiatingenrollment in either the modified ACH payment processing or linkedloyalty programs. By providing a method by which the customer maycontinue the enrollment process initiated without the necessarydocumentation to complete their enrollment in the program without havingto repeat all or part of the incomplete enrollment process, it iscontemplated that customers are more likely to complete the enrollmentprocess at a later date, thereby increasing the number of participantsin the programs offered by the merchant.

The first step in-store/second step out-of-store enrollment processcommences in the same manner as the one-step instant enrollment processdescribed and illustrated hereinabove. However, the two step enrollmentprocess deviates from the one step instant enrollment process at 212(FIG. 2A). As previously set forth, at this point in the method 200, thecustomer is asked to present financial information in sufficient detailto enable enrollment of the customer in either the modified ACH paymentprocessing or linked loyalty program. However, if, at 212, the customeris unable to sufficiently identify the financial resource, for example,the financial institution and/or account number of the checking accountto be used as the source of funds for either the modified ACH paymentprocessing or linked loyalty program, the method 200 may instead proceedto 224. For example, if a checking account is to be used as thefinancial resource, the customer may not have, in their possession, ablank check for presentation at 212.

Despite being unable to complete enrollment of the customer in theprogram, the method 200 may continue to process the enrollment so thatas much of the enrollment as possible is completed at the POS and aslittle as possible may be left for completion at a later point in time.The foregoing may be varied such that less of the process is completedat the POS and more of the process is completed at the later point intime. Accordingly, if the customer is unable to present a blank check orother suitable financial information, the method 200 may proceed to 224where the customer may again provide a unique identification code in theform and method previously described with respect to 215. Upon thecustomer providing a unique identification code, the method 200 proceedsto 225 where it is determined whether the provided identification codeis, in fact, unique. Again, the action occurring at 225 has beenpreviously described with respect to 216 and need not be described againin detail. If it is determined at 225 that the provided identificationcode is not unique, the method 200 returns to 224 for selection of a newunique identification code. If, however, it is determined that theprovided identification code is unique, the method 200 continues on to226 for selection of a PIN. Again, the action occurring at 226 has beenpreviously described with respect to 217 and need not be described againin detail. The PIN selected by the customer is subsequently appended tothe unique identification number to form a unique extendedidentification number

In one embodiment not specifically illustrated in the drawings, it iscontemplated that upon establishment of the unique extendedidentification code at 226 the in-store portion of the two-stepenrollment process, i.e., that portion of the two-step enrollmentprocess that can be completed during the customer's first visit to themerchant's store, ends. If so, the information necessary for thecustomer to later complete their enrollment in either the modified ACHpayment processing or linked loyalty program is provided at 227. Forexample, the provided information which can be used by the customer tosubsequently access an incomplete enrollment process may take the formof a confirmation code. It is contemplated that the confirmation codemay be comprised of a combination of any number of alpha-numericcharacters and/or symbols typically found on a data I/O device such as apinpad or PC. For example, a ten digit confirmation code may be suitablefor the uses disclosed herein. Typically, the confirmation code mayappear on a receipt or other type of printout generated at the POS upongeneration of a unique extended identification number. In oneembodiment, issuance of the confirmation code may be omitted and theunique extended identification code may be used to subsequently identifythe customer seeking to enroll in either the modified ACH paymentprocessing or linked loyalty program. To further enhance the ease withwhich the customer seeking to enroll in either the modified ACH paymentprocessing or linked loyalty program, it is contemplated that, inaddition to the confirmation code, the customer is provided at 227 witha telephone number and/or a web address at which their enrollment may becompleted. The aforementioned contact information may be included,together with the confirmation code, on the receipt generated at thePOS. The receipt may also advise the customer that enrollment may alsobe completed at the same or any other store operated by the merchant.

In one embodiment shown in FIG. 2A, it is contemplated that afterissuing at 227 the confirmation code (or in lieu thereof where suchinformation is provided at 231) for subsequent use by the customer tocomplete enrollment in either the modified ACH payment processing orlinked loyalty program, the method 200 may then initiate enrollment ofthe customer into the loyalty program. In other embodiments notillustrated in the drawings, enrollment of the customer in the loyaltyprogram may occur within any portion of the two step process forenrolling the customer in either the modified ACH payment processing orlinked loyalty program and, within that portion, at any point thereof.Enrollment in the loyalty program while out-of-store may pose certaincomplications if the loyalty program is card-based. If so, the customermay either pick up the loyalty card at a store at a later date or awaitthe arrival of the loyalty card through the mail. Among the variousembodiments, enrolling a customer in the loyalty program during thefirst part of a two step process for enrolling the customer in a linkedloyalty payment processing program is preferable because it satisfiesanother objective of the merchant-enroll as many customers in theloyalty program as possible. Such an objective is preferably satisfiedin the first portion of the enrollment process since, whenever theenrollment process is broken into two portions, the likelihood that thecustomer may fail to complete enrollment in either the modified ACHpayment processing program or linked loyalty program is increased.Similarly, within any given portion of the enrollment process, it ispreferable to enroll the customer in the loyalty program at as early apoint as is possible since, by doing so, in the event that the customerdecides not to complete enrollment in the modified ACH paymentprocessing or linked loyalty program, in the interim, the customer maystill have been enrolled in the loyalty program.

At 228, the method 200 determines whether the customer is currentlyenrolled in the loyalty program. In this regard, it is again noted that,at 209, the customer indicated to the employee whether or not they areenrolled in the loyalty program. If the customer is not enrolled in theloyalty program, the method 200 continues on to 229 for determination asto whether the customer wishes to enroll in the loyalty program. Themanner for determining whether the customer wishes to enroll in theloyalty program at 229 was previously described with respect to 222 andneed not be described in detail again. If it is determined at 229 thatthe customer wishes to enroll in the loyalty program, the processcontinues on to 230 where the customer is enrolled in the loyaltyprogram in a manner similar to that previously set forth with respect to207. Upon enrollment of the customer in the loyalty program at 230 or,upon the customer indicating at 220 that enrollment in the loyaltyprogram is not desired or upon the customer indicating at 228 that theyare already participants in the loyalty program, the first step of thetwo step in-store/out-of store process for enrolling in either themodified ACH payment processing or linked loyalty program is completeand the customer may proceed to complete the second step in the process.Accordingly, the process continues on to 231 where the customer receivesinstructions on how to complete enrollment. The instructions maycomprise the information described at 227, e.g., a confirmation code.Further, the instructions may be provided to the customer by way of aprintout generated at the pinpad. The instructions may be provided tothe customer in various ways. Preferably, the printout contains aUniform Resource Locator (URL) address of a web site where the customercan complete enrollment in either the modified ACH payment processing orlinked loyalty programs via a PC or other computing device. The printoutmay also contain a telephone number which the customer can call tocomplete enrollment in either the modified ACH payment processing orlinked loyalty program. The instructions may also advise the customerthat they can also complete enrollment in either the modified ACHpayment processing or linked loyalty program during a subsequent visitto the same or another store operated by the merchant.

If the customer elects to complete enrollment in either the modified ACHpayment processing or linked loyalty program out-of-store, the method200 continues on to 232 where the customer remotely accesses theenrollment system operated by the merchant. As previously set forth, thefirst, in-store, portion of the enrollment in either the modified ACHpayment processing or linked loyalty program was completed when thecustomer was provided with a telephone number or web site to be accessedwhen initiating the second portion of the enrollment process from aremote location. Accordingly, the provided telephone system or web siteis accessed at 232, for example, by dialing the provided number ordirecting a web browser to the provided IP address. It is to beunderstood that enrollment in either the modified ACH payment processingor linked loyalty program may be completed at any suitable timesubsequent to completing the in-store enrollment. In addition, thetelephone system or web site may be accessed at any suitable location.For instance, the telephone system or web site may be accessed at aremote location such as at the customer's place of residence. Thetelephone system may include a series of voice prompts by which thecustomer may be guided through completion of the enrollment process.Similarly, the web site may include a series of screens through whichthe customer may navigate. At step 233, a voice or screen prompt may askthe customer whether the customer is starting or completing enrollmentin either the modified ACH payment processing or linked loyalty program.If the customer indicates that they are completing a pending enrollment,the method 200 continues to 234 where the customer transmits theconfirmation code and/or unique identification code, for example, bydepressing a string of digits on the keypad of the telephone or PC.

At 235, the received confirmation code is compared to a series ofconfirmation codes maintained in memory and, if the receivedconfirmation code matches one of the confirmation codes stored inmemory, the received confirmation code is accepted and the customerproceeds to 236 to complete enrollment in either the modified ACHpayment processing or linked loyalty program. In an alternativeembodiment thereof, it is contemplated that the unique extendedidentification code produced at 225 may be used in place of theconfirmation code provided at 227. In another alternative embodiment, itis contemplated that the unique extended identification code produced at225 may be used in conjunction with the confirmation code provided at227. For example, the customer may be asked to provide the confirmationcode and, if the provided confirmation code is validated, the customermay then be asked to provide the unique extended identification codeproduced at 225. In this embodiment, only after both the confirmationcode and unique extended identification code are accepted, for example,by successfully matching the provided confirmation and unique extendedidentification codes to the corresponding codes stored in memory, themethod 200 continues on to 236. If, however, the confirmation code,unique extended identification number or both are declined, for example,if one or both fail to match one of the confirmation codes and/or uniqueextended identification codes maintained in memory, the method 200proceeds to 241 where a remote rejection is issued. In this regard, theremote rejection 241 is generally similar to the out-of-store rejectionat 206 and need not be described in greater detail herein.

Upon a successful match of the confirmation code and/or unique extendedidentification code to a corresponding confirmation and/or uniqueextended identification code stored in memory at 236, the method 200continues on to 237 where the customer provides financial accountinformation, typically, account information for a checking account, thatwas unavailable at 212 when the customer unsuccessfully attempted a onestep, in-store instant enrollment in either the modified ACH paymentprocessing or linked loyalty program. Typically, the financialinformation provided by the customer at 236 is similar to financialinformation previously presented at 212 and need not be described ingreater detail here. Most commonly, however, the financial informationis comprised of the routing number and account number for a checkingaccount maintained, on behalf of the customer, at a financialinstitution. Upon providing financial information at 236, the method 200continues on to 237 for determination as to whether the providedfinancial information is acceptable. Typically, acceptability of theprovided financial information is determined in the same mannerpreviously set forth with respect to 213 and need not be described infurther detail herein.

If the provided information is determined to be unacceptable, the method200 proceeds from 237 to 241 where, as previously set forth, a remoterejection is again issued. If, however, the provided financialinformation is acceptable, the method 200 proceeds to 238 fordetermination as to whether the customer has satisfied the terms andconditions requirement necessary to complete enrollment of the customerin either the modified ACH payment processing or linked loyalty program.As before, the process by which it is determined whether the customerhas satisfied the terms and conditions requirement is fully set forthbelow with respect to FIG. 3 and need not be described in greater detailherein. If it is determined that the customer has met the terms andconditions requirements set forth at 238, the method proceeds to 239 and240 for respective payment and security verification of the customer.The payment and security verification at 239 and 240 are generallysimilar to those previously set forth at 219 and 220, respectively, andthus need not be described in greater detail. Likewise, the terms andconditions requirement at 238, the payment verification at 230, thesecurity verification at 240 may be performed in any suitable order asdescribed previously with respect to like functions at 218, 219, and220, respectively. If the customer passes both the payment verificationat 239 and the security verification at 240, the method 200 proceeds to242 and enrollment of the customer in either the modified ACH paymentprocessing program (if it was determined at 228 that the customer wasnot a current participant in the loyalty program and the customerdeclined enrollment in the loyalty program at 229) or in the linkedloyalty program (if it was determined at 228 that the customer was acurrent participant in the loyalty program or if the customer enrolledin the loyalty program at 230). Enrollment in the linked loyalty programor the modified ACH payment processing program or further includes thefunctionality and linking described previously at 207 and 208,respectively.

The first, in-store portion of the two step in-store/out-of-storeenrollment process may occur in real time. Preferably, the first portionof the enrollment process takes place at the POS and is performed“instantly”, i.e., is completed in a sufficiently short period of timeshort so that the quality of service to the customer (and/or othercustomers) is adversely affected as described previously. In oneembodiment, an instant enrollment process is a process that may becompleted in less than about 1 minute, alternatively less than about 45seconds, further alternatively less than about 30 seconds, and stillfurther alternatively less than about 15 seconds. Accordingly, it iscontemplated that the first portion of the in-store/out-of-storeembodiment is initiated as part of the one step in-store enrollmentprocess previously described herein and converts into a two stepin-store/out-of-store enrollment process only when it is determined thatthe customer does not have a check, other instrument or knowledge of thefinancial information necessary to complete enrollment in either themodified ACH payment processing or linked liability program. Thus, it iscontemplated that the time that may elapse from initiating theenrollment process at 201 to completion of the in-store portion of thetwo step process at 231 may be accomplished in less than about 30seconds. While each of the first and second portions of the two stepin-store/out-of-store enrollment process mayoccur in real time, therespective portions of the enrollment process are separated by a periodof time, the duration of which may vary dramatically. Thus, while eachof the first and second portions of the two step in-store/out-of-storeenrollment process described herein are accomplished in real time, acustomer is enrolled in either the modified ACH payment processingprogram or the linked loyalty program system only after both portionsare completed. Thus, enrolling in either the modified ACH paymentprocessing or linked loyalty program by completing the two stepin-store/out-of-store process will take considerably longer than thetime required to enroll in the same program using the one step, instantin-store enrollment process described herein.

C-2 A First Step In-Store/Second Step In-Store Enrollment Process

The first step in-store/second step in-store enrollment process isgenerally similar to the first step in-store/second step out-of-storeprocess set forth above in Section C-1. In this embodiment, however,rather than completing the process at a remote location, for example, athome, the customer returns, at a later time, to either the same store ora second store operated by the merchant. For example, the customer maycontinue or resume a previously initiated in-store enrollment at the POSor a store kiosk. Thus, after receiving instructions on how to completeenrollment at 231, the method may instead proceed to 245 (FIG. 2B)where, upon initiation of a transaction at the POS, the customer mayindicate that they wish to complete enrollment in either the modifiedACH payment processing or linked loyalty program. The employee may thenrequest, and the customer may present, an acceptable form ofidentification, again, for example, a government issued ID such as adriver's license. Further details of acceptable forms of identificationare set forth above with respect to 203 and need not be described hereinin greater detail. If, however, the customer declines or is otherwiseunable to present an acceptable form of identification at 245, themethod proceeds to 205 (FIG. 2A) for issuance of an in-store rejectionand subsequent processing in the manner previously set forth inconnection with the one step in-store enrollment process.

Upon presentation of the government issued ID at 245, the methodproceeds to 246 for verification of the presented ID. Verification ofthe presented ID was previously set forth in greater detail with respectto 204 and need not be described in greater detail herein. If thepresented ID is verified, the method proceeds to 247. If, however, thepresented ID cannot be verified, the method may proceed to 205 (FIG. 2A)for issuance of an in-store rejection and subsequent processing in themanner previously set forth in connection with the one step in-storeenrollment process.

At 247, the customer is prompted to provide the confirmation codereceived at 227 (or 231) of the first portion of the first stepin-store/second step in-store enrollment process. For example, thecashier may ask the customer to enter the confirmation code using thepinpad deployed at the POS, or likewise, an automated prompt at a storekiosk or web application may prompt the customer. If the customer electsto provide the requested confirmation code, the customer enters theconfirmation code using the pinpad. Alternately, the customer mayaudibilize the confirmation code for subsequent entry by the employee.Here, rather than the confirmation code, in a first alternate embodimentspecifically contemplated herein, the customer may instead provide, uponcorresponding request of the employee, the unique extendedidentification number generated at 224. In a second alternateembodiment, the customer may instead provide, upon request by thecashier, both the confirmation code and the unique extendedidentification number. If presented with both the confirmation code andthe unique extended identification number, the customer may provide thetwo codes as a single string of digits or, as is more likely, as twoseparate strings of digits provided in response to respective requestsby either the employee and/or the display portion of the pinpad. If,however, the customer declines to present the requested confirmationcode, unique extended identification number or combination of the two,the method 200 proceeds to 205 (FIG. 2A) for issuance of an in-storerejection and subsequent processing in the manner previously set forthin connection with the one step in-store enrollment process.

Returning to FIG. 2B, if the customer presents the confirmation code (orother requested code and/or number), the method proceeds to 248 forconfirmation of the confirmation code (or other requested code and/ornumber). Upon presentation the confirmation code or, in the alternative,either the unique extended identification code and/or a combination ofthe confirmation code and unique extended identification number, iscompared to a corresponding list, for example, a list of confirmationcodes maintained in memory as was described previously at 235 of FIG.2C. If a match is identified, the method proceeds to 249 for furtherprocessing. If, however, no match is identified, the method proceeds to205 (FIG. 2A) for issuance of an in-store rejection and subsequentprocessing in the manner previously set forth in connection with the onestep in-store enrollment process.

Returning to FIG. 2B, if the confirmation code is accepted at 248, themethod proceeds to 249 for determination as to whether the enrollmentwas initiated in-store or out-of-store. It is contemplated that theforegoing may be determined using a variety of techniques. For example,if enrollment was initiated out-of-store, the customer would havealready provided the requested financial information. Conversely, ifenrollment was initiated in-store, the customer would have not yetprovided financial information. One manner of distinguishing the twowould be to generate confirmation codes with the first digit being “0”if enrollment was initiated in-store or “1” if enrollment was initiatedout-of-store. The foregoing is but one example of innumerable ways inwhich the two may be distinguished. Nor is use of the confirmation codethe only way to distinguish between the two. For example, if the uniqueidentification number does not have a PIN assigned thereto, enrollmentmay be designated as having initiated out-of-store where a prohibitionexists to providing a PIN from an out-of-store source (e.g., via theInternet), for example due to security reasons. In an embodiment, thecustomer is simply prompted, for example via pinpad or by a questionfrom an employee, as to whether enrollment was initiated in-store orout-of-store. If it is determined at 249 that the customer initiatedenrollment in-store, the method proceeds to 250 for presentation of acheck or other appropriate financial information for later use incompleting ACH transactions as described with respect to 212 of FIG. 2A.

If it is determined at 250 that the customer does not have a check orother appropriate financial information, the method proceeds to 205(FIG. 2A) for issuance of an in-store rejection and subsequentprocessing in the manner previously set forth in connection with the onestep in-store enrollment process. If, however, it is determined at 250that the customer has a check or appropriate financial information forpresentation, the financial information is transmitted to the merchantin a manner similar to that previously described with respect to 212 ofFIG. 2A and the method proceeds to 251. At 251, the financialinformation inscribed on the check or otherwise provided to the merchantis checked in a manner similar to that previously set forth with respectto 213 of FIG. 2A. If the provided financial information is notacceptable, the method may again proceed to 205 for issuance of anin-store rejection and subsequent processing in the manner previouslyset forth in connection with the one step in-store enrollment process.If, however, it is determined that the financial information isacceptable, the method proceeds to 218 (FIG. 2A) for further processingin the manner previously set forth in the one step in-store enrollmentprocess, until the customer is either enrolled in the modified ACHpayment processing program, enrolled in the linked loyalty program orenrollment of the customer is terminated by issuance of in-store and/orout-of-store rejections.

In the foregoing manner, the first step in-store/second step in-storeprocess for enrolling a customer in either the modified ACH paymentprocessing or linked loyalty program has been described. The foregoingprocess is particularly well-suited for customers who fail to rememberto complete their enrollment using the telephone or PC but are remindedupon a subsequent visit to the merchant's store. The foregoing processis also well suited for those customers who do not have access to thePSTN or, more commonly, the Internet. Finally, the process is also wellsuited for those customers who are uncomfortable with providingconfidential financial information over the Internet or other unsecuredconnection.

C-3 A First Step Out-of-Store/Second Step In-Store Enrollment Process

Unlike the foregoing processes, the first step out-of-store/second stepin-store enrollment process set forth herein enables a merchant toinitiate the enrollment of customers in either the modified ACH paymentprocessing or linked loyalty programs without having the customers visitthe store. By allowing enrollments to be initiated in this manner, themerchant is able to reach customers who would ordinarily dismiss effortsto enroll them during a visit to a store. Also, the merchant would beable to reach customers visiting their web site, for example, in searchof coupons or other special offers. Finally, as customers are able tocomplete a number of the acts required for enrollment, the merchant maybe able to more quickly process the enrollment of the customers during asubsequent visit to the store.

The first, out-of-store, portion of the enrollment method commences at252 and proceeds to 232 where the customer remotely accesses theenrollment system operated by the merchant or payment program thirdparty as described previously. For example, the customer may remotelyaccess the enrollment system by directing a web browser to the web siteoperated by the merchant and indicate that enrollment in either themodified ACH payment processing program or linked loyalty program isdesired. For example, the web site may include a page which includes adescription of the programs and a link, typically, a graphical userinterface (GUI) such as a button, which, upon selection by the customer,re-directs the customer to a new page where enrollment of the customermay be initiated. The method then continues to 233 for determinationwhether the customer had already begun enrollment in the program. Forexample, the customer may be presented with a new page which includestext inquiring whether they are a new applicant or had already begun theenrollment process and first and second GUIs, the first of which is tobe selected if the customer had previously initiated enrollment and thesecond to be selected if the customer were a new applicant.

If the customer indicates that they have never initiated the process ofenrolling in either the modified ACH payment processing or linkedloyalty programs, the method proceeds to 253 by transporting thecustomer to a new page where the customer begins the enrollment process,typically by providing the merchant with basic identifying informationsuch as name and address. The method then continues on to 254 where thecustomer provides the merchant with financial information, typically,the routing number of the financial institution maintains a checkingaccount and the account number for the checking account. Further detailsas to the type of information which may be provided at 254 waspreviously set forth at 236 and need not be described in greater detailherein. After providing the appropriate financial information, themethod proceeds to 255 where the merchant determines if the financialinformation provided by the customer is acceptable as was previouslydescribed with respect to 237 and need not be described in greaterdetail herein. Here, however, in the event that the financialinformation is unacceptable, the method proceeds to 241 for issuance ofa remote rejection as described previously.

Typically, the remote rejection is comprised of a message indicating, tothe customer, that they cannot accept the customer's application forenrollment. The message may also contain a reason for the rejection, forexample, “unable to confirm banking information” or may be silent as tothe reason for rejection. The message may also give contact information,for example, a telephone number which the customer may call, which thecustomer can contact to obtain more information regarding the rejection.Finally, if the reason for rejection is “resolvable”, for example, thecustomer made a typing error when entering the routing number for thefinancial institution, the rejection may also give instructions on howto resolve the error. For example, if the customer made a typo whenentering the routing number for the financial institution, the remoterejection may contain a message such as “bank unknown—please re-enterthe routing number for your bank.”

If the remote rejection of the customer cannot be resolved, theenrollment process may terminate at 241. If resolvable, however, themethod would return to the prior action for which the failure to meetthe requirements thereof resulted in the transfer to 241. For example,if the remote rejection issued at 241 indicated that the financialinstitution entered by the customer could not be identified and thecustomer responds by entering the correct routing number, the customermay be returned to 255 where the modified financial information ischecked. Presuming that the basis for the remote rejection could not beresolved, it is also contemplated that, depending on the reason forissuance of the remote rejection, legal obligations may necessitate theissuance of what was previously termed as an “out-of-store” rejection.In this regard, it is noted that all of the remote rejections issued at241 are technically “out-of-store” rejections. Accordingly, for purposesof distinguishing remote rejections from other types of out-of-storerejections, when referring to a remote rejection issued at 241, the term“out-of-store” rejection shall refer to written rejections mailed to thecustomer.

Upon determining at 255 that the provided financial information isacceptable, the method proceeds to 257, which is similar in substance to224 of FIG. 2A. At 257, the applicant provides a unique identificationcode, for example, by entering their driver's license number, date ofbirth, or a combination of the two in a GUI provided by the merchant,typically, in the form of an answer box appearing next to a questionappearing in written text on a next page of the web site. If the uniqueidentification code is to be comprised of the combination of thedriver's license number and the birth date of the customer, the twocomponents of the unique identification code may be provided in responseto separate questions or a single question requesting sequential entryof the two numbers information. At 258, the provided uniqueidentification code is checked for uniqueness, which is similar insubstance to 225 of FIG. 2A. As previously set forth, a determination ofnon-uniqueness typically results from the customer incorrectly enteringtheir telephone number while, in rare circumstances, it may result fromthe use of the same telephone number by more than one person, e.g.,roommates, or the reuse of telephone numbers by a telephony serviceprovider.

If it is determined, at 258, that the provided code is non-unique, themethod returns to 257 for entry of a new unique number. While notillustrated in FIG. 2C, if the provided unique identification coderepeatedly fails the uniqueness test, the method may proceed to 241 forissuance of a remote rejection (likewise for the uniqueness check at225). Here, however, the rejection may identify that there is a problemwith the provided unique identification code and asking that thecustomer call a specified number for assistance in resolving theproblem. If, however, the uniqueness of the provided uniqueidentification code is confirmed at 258, the method proceeds to 259 and260 for payment and identification verification, respectively. As thepayment verification executed at 259 and the identification verificationexecuted at 260 are similar to those previously set forth with respectto 239 and 240, further details as to these processes need not berepeated, except for noting that a failure to pass either the paymentverification or the identification verification may result in theissuance of a remote rejection at 241. Upon passing both the payment andidentification verifications at 259 and 260, respectively, the methodmay proceed to 261 where the customer is advised that the out-of-storeportion of the enrollment process is complete and that the customer maygo to a store operated by the merchant to complete enrollment. Thepayment verification and identification verification performed at 259and 260, respectively, may differ form the payment verification andidentification verification performed at 238 and 239, respectively,depending on the amount of information, on the customer, available foruse during the verification.

As previously set forth, upon completing the first, out-of-store,portion of the enrollment process at 261, the customer receivesinstructions that the enrollment process may be completed at the POS ofany store operated by the merchant offering the modified ACH paymentprocessing or linked loyalty programs. In conjunction with 261, thecustomer receives instructions on how to complete enrollment, similar to231 of FIG. 2A, which may include a confirmation code similar to 227 ofFIG. 2A. The method 200 would then proceed to 202 (FIG. 2A) forcompletion of the second in-store portion of the enrollment process,again, for example, at the POS. At 202, it is determined whether thecustomer is a new applicant or a pending applicant for enrollment in themodified ACH payment processing or linked loyalty programs. For example,the customer may identify himself or herself as a pending applicant tothe cashier. Conversely, the cashier may learn of the customer's statusduring their initial inquiry as to whether enrollment is desired.

Upon identification of the customer as a pending applicant at 202, themethod proceeds to 245 (FIG. 2B) for completion of the second, in-store,portion of the enrollment process, e.g., 245-251 of FIG. 2B. The processfor completing enrollment of a customer in either the modified ACHpayment processing or linked loyalty programs are similar from 245-248regardless of whether the first portion of the enrollment process isconducted in-store or out-of-store. Thus, functions at 245-248 of thesecond, in-store, portion of the two step out-of store/in-storeenrollment process is similar to the second, in-store, portion of thetwo step in-store/in-store enrollment process hereinabove described. Asa result, further description of the second, in-store, step of the twostep out-of-store/in-store enrollment process at 245-248 is unnecessary.At 249, a determination is made as to whether the enrollment wasinitiated in-store or out-of-store as described previously. If it isdetermined at 249 that the customer initiated enrollment out-of-store,the method proceeds to 217 of FIG. 2A for selection of a PIN andsubsequent processing as previously described. Typically, it ispreferred that the PIN be provided in-store. However, in an alternativeembodiment, the PIN may be selected as part of the out-of-storeenrollment process described in 253 et seq. of FIG. 2C, in which casethe method proceeds from 249 of FIG. 2B to 218 of 2A for verification ofterms and conditions and subsequent processing as previously described.

C-4 An Out-of-Store Enrollment Process (One Step or Two Step Enrollment)

Unlike the foregoing processes, the out-of-store enrollment process setforth herein enables a merchant to initiate the enrollment of customersin either the modified ACH payment processing or linked loyalty programswithout having the customers visit the store. By allowing enrollments tobe initiated and completed in this manner, the merchant is able to reachcustomers who would ordinarily dismiss efforts to enroll them during avisit to a store. Also, the merchant would be able to reach customersvisiting their web site, for example, in search of coupons or otherspecial offers. Finally, as customers are able to complete the actsrequired for enrollment, the merchant may be able to more quicklyprocess the enrollment of the customers without using up time andresources in the store to perform enrollment.

The out-of-store enrollment method commences at 252 and proceeds to 232where the customer remotely accesses the enrollment system operated bythe merchant as described previously. For example, the customer mayremotely access the enrollment system by directing a web browser to theweb site operated by the merchant or the payment program third party andindicate that enrollment in either the modified ACH payment processingprogram or linked loyalty program is desired. For example, the web sitemay include a page which includes a description of the programs and alink, typically, a graphical user interface (GUI) such as a button,which, upon selection by the customer, re-directs the customer to a newpage where enrollment of the customer may be initiated (such as theillustrative screen shot shown in FIG. 2D). The method then continues to233 for determination whether the customer had already begun enrollmentin the program. For example, the customer may be presented with a newpage which includes text inquiring whether they are a new applicant orhad already begun the enrollment process and first and second GUIs, thefirst of which is to be selected if the customer had previouslyinitiated enrollment and the second to be selected if the customer werea new applicant.

If the customer indicates that they have never initiated the process ofenrolling in either the modified ACH payment processing or linkedloyalty programs, the method proceeds to 253 by transporting thecustomer to a new page where the customer begins the enrollment process,typically by providing the merchant with basic identifying informationsuch as name and address (as shown in FIG. 2E). The method thencontinues on to 254 where the customer provides the merchant withfinancial information, typically, the routing number of the financialinstitution maintains a checking account and the account number for thechecking account (as shown in FIG. 2F), and solicits authorization fromthe customer to permit the merchant or payment program third party todebit the account noted. Further details as to the type of informationwhich may be provided at 254 was previously set forth at 236 and neednot be described in greater detail herein. The customer may optionallybe provided an opportunity to review and confirm all enteredinformation, as shown in FIG. 2H. After providing the appropriatefinancial information, the method proceeds to 255 where the merchantdetermines if the financial information provided by the customer isacceptable as was previously described with respect to 237 and need notbe described in greater detail herein. During the determination by themerchant, a view may be displayed to the customer indicating that theinformation is being processed for enrollment, as shown in FIG. 2G. Inthe event that the financial information is unacceptable, the methodproceeds to 241 for issuance of a remote rejection as describedpreviously.

Typically, the remote rejection is comprised of a message indicating, tothe customer, that they cannot accept the customer's application forenrollment. The message may also contain a reason for the rejection, forexample, “unable to confirm banking information” or may be silent as tothe reason for rejection. The message may also give contact information,for example, a telephone number which the customer may call, which thecustomer can contact to obtain more information regarding the rejection.Finally, if the reason for rejection is “resolvable”, for example, thecustomer made a typing error when entering the routing number for thefinancial institution, the rejection may also give instructions on howto resolve the error. For example, if the customer made a typo whenentering the routing number for the financial institution, the remoterejection may contain a message such as “bank unknown—please re-enterthe routing number for your bank.”

If the remote rejection of the customer cannot be resolved, theenrollment process may terminate at 241. If resolvable, however, themethod would return to the prior action for which the failure to meetthe requirements thereof resulted in the transfer to 241. For example,if the remote rejection issued at 241 indicated that the financialinstitution entered by the customer could not be identified and thecustomer responds by entering the correct routing number, the customermay be returned to 255 where the modified financial information ischecked. Presuming that the basis for the remote rejection could not beresolved, it is also contemplated that, depending on the reason forissuance of the remote rejection, legal obligations may necessitate theissuance of what was previously termed as an “out-of-store” rejection.In this regard, it is noted that all of the remote rejections issued at241 are technically “out-of-store” rejections. Accordingly, for purposesof distinguishing remote rejections from other types of out-of-storerejections, when referring to a remote rejection issued at 241, the term“out-of-store” rejection shall refer to written rejections mailed to thecustomer.

Upon determining at 255 that the provided financial information isacceptable, the method proceeds to 257, which is similar in substance to224 of FIG. 2A. At 257, the applicant provides a unique identificationcode, for example, by entering their driver's license number, date ofbirth, a telephone number, or a combination of these in a GUI providedby the merchant, typically, in the form of an answer box appearing nextto a question appearing in written text on a next page of the web site.An illustrative web GUI for this purpose is shown in FIG. 21. If theunique identification code is to be comprised of the combination of thedriver's license number and the birth date of the customer, the twocomponents of the unique identification code may be provided in responseto separate questions or a single question requesting sequential entryof the two numbers information. At 258, the provided uniqueidentification code is checked for uniqueness, which is similar insubstance to 225 of FIG. 2A. As previously set forth, a determination ofnon-uniqueness typically results from the customer incorrectly enteringtheir telephone number while, in rare circumstances, it may result fromthe use of the same telephone number by more than one person, e.g.,roommates, or the reuse of telephone numbers by a telephony serviceprovider.

If it is determined, at 258, that the provided code is non-unique, themethod returns to 257 for entry of a new unique number. While notillustrated in FIG. 2C, if the provided unique identification coderepeatedly fails the uniqueness test, the method may proceed to 241 forissuance of a remote rejection (likewise for the uniqueness check at225). Here, however, the rejection may identify that there is a problemwith the provided unique identification code and asking that thecustomer call a specified number for assistance in resolving theproblem. If, however, the uniqueness of the provided uniqueidentification code is confirmed at 258, the method proceeds to 259 and260 for payment and identification verification, respectively. As thepayment verification executed at 259 and the identification verificationexecuted at 260 are similar to those previously set forth with respectto 239 and 240, further details as to these processes need not berepeated, except for noting that a failure to pass either the paymentverification or the identification verification may result in theissuance of a remote rejection at 241. The payment verification andidentification verification performed at 259 and 260, respectively, maydiffer from the payment verification and identification verificationperformed at 238 and 239, respectively, depending on the amount ofinformation, on the customer, available for use during the verification.

The process for finalizing enrollment of a customer in either themodified ACH payment processing or linked loyalty programs are similarfrom 245-248 regardless of whether the enrollment process is conductedin-store or out-of-store. Thus, functions at 245-248 of the out-of storeenrollment process is similar to the second, in-store, portion of thetwo step in-store/in-store enrollment process hereinabove described,though carried out out-of-store. The method proceeds to 217 of FIG. 2Afor selection of a PIN and subsequent processing as previouslydescribed. The PIN may be selected as part of the out-of-storeenrollment process described in 253 et seq. of FIG. 2C, in which casethe method proceeds from 249 of FIG. 2B to 218 of 2A for verification ofterms and conditions and subsequent processing as previously described.Upon completion of the enrollment process, the customer may have aenrollment completion view displayed, such as that shown in FIG. 2J,after which the customer may use the unique identification code to payfor goods or services.

D. A Method for Presentation and Acceptance of Terms and Conditions in aModified ACH Payment Processing or Linked Loyalty Program

In each of FIGS. 1 and 2A-C, reference was made as to whether thecustomer enrolling in a card-free or card-based program offered by amerchant, such as, but not limited to, ACH payment programs, loyaltyprograms and linked loyalty programs, has satisfied a terms andconditions requirement which must be met in order for enrollment of thecustomer in the program to be completed. Terms and conditions mayadditionally include agreement to a privacy policy in variousembodiments. The method by which the customer meets or fails to meet theterms and conditions requirement shall now be described with referenceto FIG. 3.

At various stages of the methods 100, 200 of enrolling customers incard-free or card-based programs offered by a merchant, such as, but notlimited to modified ACH payment processing programs, loyalty programsand linked loyalty programs, the methods 100, 200 each made inquiry asto whether or not the customer seeking enrollment in the program had metthe terms and conditions requirement established as a prerequisite forenrollment in the program. More specifically, such an inquiry was madeat 116 of the method 100 and at 218 and 238 of the method 200. Referringnow to FIG. 3, a method 300 by which it is determined whether thecustomer has met the terms and conditions requirements for enrollment inthe program will now be described in greater detail.

The method 300 commences at 302 and, at 304, the type of program inwhich the customer is enrolling is identified. For example, the systemmay include, in memory or other storage source, a list of programsoffered by the merchant. It is contemplated that the various programsoffered by the merchant may have different terms and conditions and, onoccasion, may not require any terms and conditions at all. For example,programs which incorporate financial transactions, for example, themodified ACH payment processing or linked loyalty programs may typicallyrequire detailed terms and conditions while other programs, for example,loyalty programs may require terms and conditions of less detail orperhaps no terms and conditions of use at all.

Continuing on to 306, the method 300 determines if the identifiedprogram requires the acceptance of terms and conditions in order tocomplete enrollment therein. If the identified program does not requirethe acceptance of terms and conditions, the method 300 proceeds to 307where it is determined that the terms and conditions requirement hasbeen met, a result which, in turn, may be used during the enrollmentmethods 100 and 200 illustrated in FIGS. 1 and 2A-C, respectively. If,however, it is determined at 306 that the identified program is aprogram that requires the acceptance of terms and conditions in order tocomplete enrollment, the method 300 may then proceed to 308 where theprocess being used by the customer to enroll in the identified programis itself identified. In the examples described herein, three processeswere employed during the enrollment process—an in-store POS process, anin-store kiosk PC process; an out-of-store PC process and anout-of-store telephone process. In the examples described herein, theprograms offered by the merchant uniformly required the acceptance ofcertain terms and conditions. However, acceptance of terms andconditions need not be a requirement for enrollment in the identifiedprogram as noted previously. Also, the disclosed examples uniformlyrequired at least one portion of enrollment be completed in-store butpermitted at least one portion of enrollment to be completed out-ofstore. However, it is fully contemplated that enrollment may becompleted out-of-store. Finally, while some embodiments disclosed thatsatisfaction of the terms and conditions requirement was completedin-store, it is again contemplated that the terms and conditionsrequirement may be satisfied out-of-store, for example via anout-of-store PC process such as via an Internet-based application.

After identifying the process being used by the customer to enroll inthe identified program, the method 300 proceeds to 310 for customizationof a set of terms and conditions (and/or privacy policy) based upon theidentified program and the identified process used to enroll thecustomer in the identified program. At 312, the set of customized termsand conditions are transmitted to the I/O device being used by thecustomer to enroll in the identified program and, at 314, the set ofcustomized terms and conditions are presented to the customer at the I/Odevice being used by the customer to enroll in the identified program.For example, in the modified ACH payment processing and linked loyaltyprograms hereinabove described with respect to FIGS. 2A-C, the set ofterms and conditions are transmitted from the system which controlsparticipation in the programs to the pinpad located at the POS where thecustomized terms are presented to the customer enrolling in the programat 218. Alternatively, the set of terms and conditions are transmittedfrom the system which controls participation in the programs to the userinterface, e.g., PC, where the customized terms are presented to thecustomer enrolling in the program at 238. Continuing on to 316, themethod 300 determines the manner by which the terms and conditions areto be presented to the customer. It is contemplated that the terms andconditions may be presented to the customer in the form of a hard copy,as a visible image, or both. If a hard copy of the terms and conditionsare to be presented, the method 300 proceeds to 318 where the printedterms and conditions are printed out. For example, the pinpad may have aprinting component configured to dispense a printed copy of the termsand conditions, for example via a receipt printer located at the POS. Ifdesired, the printed terms and conditions may appear on a displayportion of the pinpad generally simultaneously with the printingthereof. Alternatively, the terms and conditions may be printed via aprinter attached to the user interface, e.g., PC, at 238.

Continuing from 318 on to 320, the customer may then review the termsand conditions and, if acceptable, may accept the terms and conditionsby depressing a first GUI, typically, in the form of a button, generatedon the display portion of the pinpad or PC, with the word “YES”appearing thereon. If, however, the customer declines the presentedterms and conditions, whether by depressing a second GUI, as before,typically in the form of a button, generated on the display portion ofthe pinpad or PC, with the word “NO” appearing thereon, or by failing tomake a selection within a predetermined time period, the method 300proceeds to 322 for “re-presentation” of the terms and conditions. Whilea re-presentation of the terms and conditions for which acceptance isrequired may or may not involve the re-printing and or re-displaying ofthe actual terms and conditions, a representation of the terms andconditions does include the clearing of the customer's prior rejectionof the terms and conditions (if appropriate) or the re-set of the timeperiod in which acceptance of the terms and conditions is required(again, if appropriate) and which had previously expired without thecustomer making a selection. Re-presentation does include the systemgenerating a warning, typically, on the display portion of the pinpad,that enrollment in the modified ACH payment processing or linked loyaltyprograms cannot be completed without acceptance of the printed terms andconditions that have been presented to the customer. The method thenproceeds to 324 where the customer may have a second opportunity todecide whether they wish to explicitly accept the presented terms orconditions, again, for example, by depressing the first GUI appearing inthe form of a button having the word “YES” appearing thereon, explicitlyreject the presented terms and conditions, again, for example, bydepressing the second GUI appearing in the form of a button having theword “NO” appearing thereon or implicitly reject the presented terms andconditions, again, for example, by declining to make a selection withina pre-determined time period. If, at 324, the terms and conditions areeither explicitly or implicitly rejected, the method 300 proceeds to 326where, based upon the explicit or implicit rejection at 324, it isdetermined that the terms and conditions requirements have not been met,a result which, in turn, may be used during the enrollment methods 100and 200 illustrated in FIGS. 1 and 2A-C, respectively.

Returning now to 316, if it determined that the terms and conditions arenot to be printed at the pinpad or other I/O device such as a PC beingused by the customer to enroll in the identified program, the method 300may instead proceed to 328 for electronic presentation of the terms andconditions, typically, by generating the terms and conditions on adisplay portion of the pinpad or other I/O device such as a PC beingused to enroll in the identified program. The customer may the reviewthe terms and conditions appearing on the display portion of the pinpador PC and, if desired, may elect to accept the terms and conditions bydepressing the first GUI, typically, in the form of a button, generatedon the display portion of the pinpad or PC, with the word “YES”appearing thereon. If, however, the customer declines the presentedterms and conditions, whether by depressing a second GUI, as before,typically in the form of a button, generated on the display portion ofthe pinpad or PC, with the word “NO” appearing thereon, or by failing tomake a selection within a predetermined time period, the method 300proceeds to 330 for “re-presentation” of the terms and conditions,again, using one or more screens of the display portion of the pinpad orPC. As before with 322, a re-presentation of the terms and conditionsrequires the clearing of the customer's prior rejection of the terms andconditions (if appropriate) or the re-set of the time period in whichacceptance of the terms and conditions is required (again, ifappropriate) and which had previously expired without the customermaking a selection. Re-presentation also include the system generating awarning, typically, on the display portion of the pinpad or PC, thatenrollment in the modified ACH payment processing or linked loyaltyprograms cannot be completed without acceptance of the terms andconditions that have been presented electronically to the customer. Themethod then proceeds to 332 where the customer may have a secondopportunity to indicate whether they wish to explicitly accept thepresented terms or conditions, again, for example, by depressing thefirst GUI appearing in the form of a button having the word “YES”appearing thereon, explicitly reject the presented terms and conditions,again, for example, by depressing the second GUI appearing in the formof a button having the word “NO” appearing thereon or implicitly rejectthe presented terms and conditions, again, for example, by declining tomake a selection within a pre-determined time period.

If, at 332, the terms and conditions are either explicitly or implicitlyrejected, the method 300 again proceeds to 326 where, based upon theexplicit or implicit rejection at 332, it is determined that the termsand conditions requirements have not been met, a result which, in turn,may be used during the enrollment methods 100 and 200 illustrated inFIGS. 1 and 2A-C, respectively. If, however, the terms and conditionsrequired for enrollment in either the modified ACH payment processing orlinked loyalty programs are accepted at either 328 or 332, the method300 proceeds to 334 where the, now accepted, terms and conditions areprinted out for subsequent use by the customer. The method 330 may thencontinue to 307 where, based upon the explicit acceptance of the termsand conditions at 328 or, in the alternative, based upon the explicitacceptance of the terms and conditions at 332, it is determined that theterms and conditions requirement has been met, a result which, in turn,may be used during the enrollment methods 100 and 200 illustrated inFIGS. 1 and 2A-C, respectively.

E. A Card-Free Payment Process Suitable for Use in FinancialTransactions

FIG. 4 illustrates a method 400 by which a customer, previously enrolledin either the modified ACH payment processing program or linked loyaltyprogram in accordance with the method 100 illustrated in FIG. 1 or themethod 200 illustrated in FIG. 2, may use a unique identification codeto complete a transaction, for example, a purchase of goods from amerchant. Briefly, and in accordance with the method 400, the customeris able to access a financial resource, most commonly a checking accountmaintained on behalf of the customer by a financial institution, usingan identification code unique to the customer and known only by thecustomer and the merchant or payment program third party. By doing so,the customer may use the ACH payment processing system to complete atransaction, for example, the purchase of goods from the merchant,without access to a check, debit card or any other type of instrumenttraditionally used to access a bank account. In that the customer maymake a purchase without physical possession of cash, checks,debit/credit cards or other type of financial instrument or physicaltender, the customer is afforded considerably more flexibility whenneeding to access their financial resources. For example, a customerwould no longer be obligated to carry cash, a checkbook, debit/creditcards or the like when patronizing a store operated by the merchant.

The method 400 commences at 402 where a cashier or other representativeof a merchant requests payment for goods being purchased by a customer.In response, the customer indicates, also as part of 402, that they wishto pay using the card-free payment program offered by the merchant inwhich they had previously enrolled. The customer may indicate thedesired method of payment by stating their intention or by depressing aselected key on a pinpad located at the POS, commonly used by customersto indicate the form of payment to be tendered. Upon indicating thatthey intend to tender payment using the card-free payment program inwhich they had previously enrolled, the customer may now provide thecashier with the information necessary for the cashier to initiate anACH transaction similar to that used when a customer presents a check ordebit card for payment.

The method 400 proceeds, in sequence, to 406, 408 and 410. In each ofthese steps, the customer provides one component of the uniqueidentification code. As previously set forth, one configuration of theunique identification code is constructed of three components—thecustomer's telephone number, the customer's birth date and a PIN. Whileit is contemplated that the customer may simply say the uniqueidentification code and the cashier uses the provided information toinitiate an ACH transaction, such a process is preferably discouragedbecause of the absence of security. Similarly, it is contemplated thatthe customer may provide the unique identification code to the cashierby answering a series of questions, the answer to each of which is onecomponent of the unique identification code. Again, the foregoingprocess is not preferable because of the absence of security. A similarprocess which is somewhat more secure but still discouraged involves thecustomer answering a pair of questions asked by the cashier immediatelyfollowed by use of the pinpad.

For security purposes, it is preferred that the customer enter theunique identification code using the pinpad or other data I/O devicelocated at the POS. For example, after depressing a button indicatingthat the customer intends to pay using the card-free payment program (orupon the cashier activating the pinpad for payment using the card-freepayment program), the customer enters the unique identification coderequired for the cashier to initiate an ACH transaction. It iscontemplated that the customer may simply enter the entire uniqueidentification code (in the disclosed embodiment, an eighteen ornineteen digit number) in response to a request in the display portionof the pinpad for entry of the unique identification number. Or, asillustrated in FIG. 4A, the customer may simply reply to each one of aseries of queries (the first being “please enter your telephone number”,the second being “please enter the month and day of your birth date” andthe third being “please enter your security code”), with the answer toeach of which being one component of the unique identification code ofthe customer.

Upon entry of the components of the unique identification code, themethod 400 proceeds to 410 where a unique authorized transaction code isconstructed from a transaction identifier, the unique identificationcode and a transaction descriptor. While it is contemplated that variousdevices may construct the unique authorization transaction code, in mostcases, the POS constructs the unique authorized transaction code from acombination of the data entered by the cashier, typically, the type andamount of the transaction and the unique identification code provided bythe customer. The transaction identifier is a code which identifies thetype of transaction being conducted. While the transaction identifiermay vary depending on the type of transaction being conducted, here thetransaction identifier would identify the transaction as a card-freepayment. The transaction descriptor, on the other hand, would describethe transaction itself. While the transaction descriptor may also varydepending on the type of transaction being conducted, for a card-freepayment, the transaction descriptor may be comprised of a single fieldcontaining the amount of the purchase requested by the customer.

At 414, the unique authorized transaction code is transmitted to acomputer system for execution of the transaction defined by the uniqueauthorized transaction code. The computer system may be the POS itself,a local server tied to each POS at the store where the purchase is beingmade or a main server, tied to each local server, and installed at aremotely located control center. Uniquely, and as will be more fully setforth with respect to FIG. 5, below, in addition to executing financialtransactions, the computer system also controls operation of the variousprograms offered by the merchant, including the loyalty program, thecard-free payment program (including both the modified ACH paymentprocessing program and the linked loyalty program) and any other programoffered by the merchant. Continuing on to 416, the transactionprocessing system identifies the type of transaction associated with theunique authorized transaction code. For example, the computer system maycheck the contents of the first field (which, as previously set forth,contains the transaction identifier for the transaction) of the uniqueauthorized transaction code received thereby to a list of transactiontypes maintained in memory. By matching the received transactionidentifier to one of the transaction types listed in memory, thecomputer system identifies the received authorized transaction code ascorresponding to a particular type of transaction. In the foregoingexample, the aforementioned comparison would result in the computersystem determining that the received authorized transaction codecorresponds to a card-free payment.

Upon identifying the transaction defined by the unique authorizedtransaction code as being a card-free payment transaction, the method400 proceeds to 418 for determination as to whether the customer whoprovided the unique identification code to the POS is enrolled in acard-free payment program offered by the merchant. In the example setforth herein, the card-free payment programs offered by the merchant arethe modified ACH payment processing program and the linked loyaltyprogram. It is fully contemplated that the card-free payment program mayalso encompass programs other than those specifically recited herein. Todetermine whether the customer is enrolled in one of the card-freeprograms offered by the merchant, the computer system checks theidentity of the customer against a list of enrollees in the card-freeprograms. To do so, the computer system maintains, in memory, a list ofparticipants in the card-free programs. In the present embodiment, eachparticipant is identified by the first and second components of theunique identification code which, as previously set forth, respectivelyform the second and third fields of the received authorized transactioncode. If the second and third fields of the authorized transaction codematch the identity of one of the participants in the card-free paymentprogram, the method 400 proceeds to 420 for further processing. If, onthe other hand, the second and third fields of the unique authorizedtransaction code fail to match the identity of one of the participantsin the card-free payment program, the method 400 may instead proceed to424 where the computer system declines the requested transaction. Thecomputer system may then forward a transaction rejection message to thePOS which, in turn, generates a message on the display portion of thepinpad indicating that the transaction has been declined.

Returning to 418, upon confirming that the customer requesting executionof a card-free payment transaction is enrolled in a card-free program,the method proceeds to 420 for determination as to whether the receivedauthorized transaction code is valid. To do so, the computer systemfurther maintains, in memory, a list of authentication codes for theparticipants in the card-free payment program. The authentication codefor a participant is the PIN which, as previously set forth, forms thethird component of the unique identification code for a participant inthe card-free payment program. Each PIN is linked to an enrollee sothat, upon identification of an enrollee, the computer system canretrieve the PIN corresponding to that enrollee. In accordance with theembodiment in which the PIN is unique for each customer, there is noneed for linking each PIN to a corresponding one of the customersenrolled in the card-free program. Using the link between enrollees andauthentication codes, the computer system identifies the authenticationcode corresponding to an enrollee. The computer system may then comparethe PIN for the enrollee identified in 418 to the contents of the fourthfield of the received authorized transaction code. If the contents ofthe fourth field of the received authorized transaction code fail tomatch the PIN of the identified customer, the method 400 proceeds to 424for rejection of the transaction in the manner previously set forth. If,however, the PIN retrieved from memory matches the fourth field of thereceived authorized transaction code, the requested transaction isauthorized and the method 400 proceeds to 422 for further processing.

Continuing on to 422, the computer system proceeds to construct thetransaction request from the transaction descriptor contained in theauthorized transaction code and the customer information contained inthe participation information for the customer requesting execution ofthe transaction. At 422, the computer system constructs a transactionrequest from the message using information maintained in the memory andthe transaction descriptor, here, the fifth field of the authorizedtransaction code containing the amount of the purchase sought to becompleted by the customer. More specifically, the transaction request isconstructed from the participation information maintained in the memoryfor each of the customers enrolled in a program offered by a merchant.For example, in a modified ACH payment processing program, theparticipation information for a participant in the payment program iscomprised of the routing number of the bank or other financialinstitution with which the financial transaction is to be conducted andthe account number for an account maintained at the identified financialinstitution on behalf of the participant. The participation informationfor each customer enrolled in the payment program is linked to theaccess information (e.g., the unique identification code) for thecustomer enrolled in the payment program. Accordingly, upon confirmingthat a customer is a participant in the payment program and authorizingthe requested transaction, the computer system may then access theparticipation information necessary to construct a transaction requestneeded, together with the transaction descriptor, to issue a transactionrequest.

At 422, the computer system executes the transaction identified in thefirst field of the received transaction code, for example, a card-freepayment processing program such as the modified ACH payment processingprogram. For example, if the requested transaction was a modified ACHpayment processing transaction to be used by the customer to pay for apurchase at the POS, the computer system would construct a transactionrequest which includes the financial institution where the customermaintains an account, the number of that account and the amount to bedebited from that account. The computer system would then indicate tothe POS that the transaction has been completed such that the customermay exit the POS and the POS system may be reset to begin at 402 forprocessing another card-free payment transaction. Once the transactioninformation is captured by the computing system, e.g., a store LAN ormerchant-wide WAN, the POS terminal is freed to process anothertransaction while the remainder of steps required to receive payment fora previous transaction may be carried out as follows.

Method 400 may be implemented via a computing system such as that setforth in FIG. 5C. Plural POS locations are represented by 701, 702, and703 may be linked via a local area network to a local server 705residing at a merchant location 710. An ACH payment transactionaccording to method 400 may be started by a customer at any of POSlocations 701, 702, or 703 and processed as described previously vialocal server 705. The computer system 705 does not directly request theamount to be debited from the customer's account. Rather, the request isprocessed through the well-known ACH network and system 775, which isimplemented by the banking system 800. The ACH process 775 includes anumber of additional entities including, but not limited to, anoriginating depository financial institution (ODFI) 780, a centralclearing facility 785, and a receiving depository financial institution(RDFI) 790. The ODFI 780 is the merchant's financial institution thatreceives formatted payment instructions from the merchant correspondingto the transaction request. In this regard, the computer system does notdirectly transmit the transaction request to the ODFI 780. Rather, thecomputer system passes the transaction requests a collection system, forexample a payment switch 700, which records information related to thetransaction in a database maintained by the merchant. Where the merchantoperates multiple stores 745, various computer systems distributed atthe store level may forward the transaction requests to a centralizedserver or payment switch 700 located at a control center 755 forconsolidation of the transaction requests. The transaction requests maybe formatted into a format suitable for transmission to the ODFI 780,which may be performed at the central server/switch or alternatively byan ODFI interface 750 such as a third party service provider. Thepayment switch 700 and/or the ODFI interface 750 may update transactioninformation in a reporting database 740 that is accessible by variouscomponents of the methods and systems described herein as needed forsuch information stored therein. The ODFI interface 750 may format andbundle plural transaction requests into a single data package fortransmission to the ODFI 780, which in turn passes the instructions foreach transaction received thereby to the central clearing house,commonly known as an ACH Operator 785. The ACH Operator 785 may be, forexample, a federal reserve bank. Using the received instructions, theACH Operator 785 identifies the RDFI 790. The ACH operator 785 thentransmits the payment information to the identified RDFI 790. The RDFI790 receives the payment information and processes the paymentinformation. If funds are available, the ODFI 780 may receive the fundsfrom the RDFI 790 on a settlement date. The foregoing is a highlysimplified description of an ACH network and system 775. However, suchsystems are known in the art and, once the transaction request isreceived by the ODFI interface, any further processing of thetransaction request in connection with the payment of funds to themerchant is conventional in nature and need not be described in furtherdetail. Upon execution of the transaction at 426, the method mayconclude, or alternatively may proceed with a tender-based reward asfollows.

F. A Method for Distributing Tender-Based Rewards in a Loyalty Program

Referring next to FIG. 4B, a method 428 for distributing tender-basedrewards will now be described in greater detail. In the embodimentdescribed and illustrated herein, the method 428 is initiated uponconclusion of the method 400 for card-free payment by a customer forgoods or services to be purchased from a merchant. In this regard, it isnoted that, in order for the customer to complete a card-free purchase,enrollment in either a modified ACH payment processing program or alinked loyalty program is required. Thus, in the embodiment disclosedherein, the customer is enrolled in both a card-free payment processingprogram and a second type of program a tender based reward program.Enrollment in either a card-free payment processing program such as amodified ACH payment processing program or a linked loyalty program isnot a requirement for enrollment in the tender-based reward programdisclosed herein. Thus, the method 428 may be executed independently ofmethod 400, and need not necessarily be preceded thereby. Similarly,enrollment in a loyalty program is also not a requirement for enrollmentin the tender-based reward program. Finally, it is fully contemplatedthat the techniques disclosed herein are equally applicable to loyaltyprograms as well as other types of programs, offered to customers by amerchant, not specifically recited herein.

In the method described herein, certain links between the informationmaintained in the memory associated with the computer system aredisclosed. The most common of these links involve the loyalty program.For example, when, as previously set forth, a customer enrolls in aloyalty program, an account number is assigned to the customer. Thisaccount number is then linked to a set of benefits which the customershall receive in return for participating in the program. In thismanner, the computer system is able to determine, based upon the accountnumber for the customer, the benefits to which a customer is entitled toreceive upon completion of a particular transaction. The card-freepayment processing program, which is also referred to herein as amodified ACH payment processing program if the customer is not enrolledin a loyalty program or as a linked loyalty program if the customer isalso enrolled in a loyalty program, operates in a somewhat similarfashion. During the enrollment process, a unique identification code isassigned to each customer. Within the memory, the unique identificationcode is linked to the customer's participation information, i.e., theinformation required to execute a financial transaction.

In this manner, the unique identification code is used to provide accessto the information, for example, the routing number for a financialinstitution and an account number for a checking account maintained bythe financial institution, required for initiation of a financialtransaction, for example, a debit to the customer's checking account,using the card-free payment processing program. So that the customer maytake advantage of the benefits of other programs in which they haveenrolled, a link is established between the unique identification codeand each such program. In this regard, while it is fully contemplatedthat the unique identification code may be linked directly to eachadditional program to which the customer has enrolled (including thosemaintained by the same merchant or other third parties), in theembodiment disclosed herein it is contemplated that the uniqueidentification code for each customer is linked to the loyalty programaccount number for that customer and, in turn, the loyalty programaccount number for that customer is linked to the program benefits foreach other program in which the customer is enrolled.

Thus, as may be seen in FIG. 4B, the method 428 commences at 429 whereit is determined whether the customer is enrolled in any other programs,for example a tender-based reward program in which rewards aredistributed based upon the type of tender offered by a customer enrolledin the program used in a completed transaction, for example, a purchaseof goods or services completed in accordance with the card-free purchasemethod 400. While it is specifically contemplated that the tender-basedreward program may be structured to distribute any desired type ofreward to participating customers, a common reward is the cash rebate.In such a program, the merchant distributes cash rebates based upon aset percentage of purchases made using the desired type of tender. It iscontemplated that the merchant or payment program third party may enjoyany number of benefits by offering a tender-based reward program such asthe one described herein. For example, if the merchant is assessed a 3%service charge on transactions paid by credit card, the merchant orpayment program third party may offer a tender-based reward program inwhich the customer is awarded a 1½% rebate on purchases made using cashor a card-free ACH transaction as described previously. By establishingsuch a program, the merchant or payment program third party may be ableto recapture a significant portion of revenues lost to service chargesassessed for transactions made on credit, particularly when asignificant portion of the merchant's sales are made on credit.Similarly, the merchant or payment program third party may establish atender-based reward program in which a set percentage of sales aredonated to local charities if the purchases are made with a credit cardissued by the merchant. Alternatively, a customer may accumulate pointsbased upon tender type that may be used for discounts, free items,promotional items, etc. Likewise, discounts may be provided based ontender type. A wide variety of tender-based rewards are contemplatedherein.

For the computer system to determine, at 429, whether a customer, here,a customer for whom a card-free payment transaction has just beencompleted in accordance with the method 400, is enrolled in anadditional program offered by a merchant or program third party, here,the merchant with whom the customer has just completed the transaction,the computer system utilizes the unique identification code provided bythe customer during the card-free payment transaction to link from theunique identification number to the loyalty program account number. Fromthe loyalty program account number, the computer system may then link tothe benefits associated with a first program, for example, the benefitsassociated with the aforementioned tender-based rewards program, inwhich the customer is enrolled. Conversely, the absence of such a linkindicates that the customer is not enrolled in any additional programs.It is contemplated that, in the alternative, the loyalty program accountnumber which identifies enrollees in the loyalty program may instead belinked to the enrollees in the tender-based rewards program. In turn,the enrollees in the tender-based rewards program would be linked to thecorresponding benefits of participation in the tender-based rewardsprogram.

If it is determined at 429 that the customer is not enrolled in anyother programs, the method 428 ends at 436. If, however, it isdetermined at 429 that the customer is enrolled in another program, themethod 428 then proceeds to 430 for determination if the customer isentitled to any benefits under the rules of the tender-based rewardsprogram or other additional program in which the customer is enrolled.To do so requires access to two data components—the benefits associatedwith the tender-based reward program or other program in which thecustomer is enrolled and the authorized transaction code transmitted tothe computer system by the POS. For example, the tender-based rewardsprogram may be configured to distribute a cash rebate of 1½% of thepurchase price if the customer tenders payment in the form of a directdebit from their checking account, which may be initiated as either acard-based or card-free transaction. By comparing information regardingthe type of transaction conducted contained in the authorizedtransaction code to a list of rewards to be distributed depending on thetype of transaction conducted, the computer system may determine, at430, whether any benefits may be distributed to the customer. In theforegoing example; if the authorized transaction code indicates that thetransaction was paid by direct debit to the customer's checking accountand the other program benefits linked to the customer by the uniqueidentification number contained in the authorized transaction codeindicates that the customer shall receive a 1½% rebate if payment wasmade by direct debit, the computer system may determine at 430 that thecustomer is entitled to benefits under the tender-based rewarddistribution program and, continuing on to 432, the computer system mayissue the indicated benefit to the customer. For example, the computersystem may issue a command to the POS indicating that the customer is toreceive a rebate of a selected amount of cash. Such rebate need not bepaid instantly at the POS, but rather notification of the rebate may beprovided at the POS and such rebates may be cumulated and issuedperiodically at the POS or otherwise, for example via mail. If, however,the comparison of the authorized transaction code and the list oftransactions and associated benefits indicates that the customer has notcompleted a transaction which entitles the customer to a benefit, themethod 428 proceeds to 434 for further processing.

Upon the computer system providing the indicated benefits to thecustomer at 432 or upon determining, at 430, that the customer has notcompleted any transactions which entitle the customer to any benefitsunder the program, the method proceeds to 434 for determination as towhether the customer is enrolled in an additional program offered by themerchant. As the method of determining, at 434, whether the customer isenrolled in another program which may or may not entitle the customer tobenefits as a result of the completion of a transaction between merchantand the customer is generally similar to the method previously set forthwith respect to 429, further description of 434 is not necessary.However, if it is determined at 434 that the customer is enrolled in anadditional program offered by the merchant which may entitle thecustomer to benefits, the method 428 returns to 430 for furtherprocessing in accordance with the methods set forth above. If, however,it is determined at 434 that the customer is not enrolled in any otherprograms which may entitle the customer to benefits, the method 428 endsat 436.

G. A Computer System Suitable for use in Conjunction with Either aModified ACH Payment Processing or Linked Loyalty Program

The methods hereinabove described in Sections (A) through (F) areimplemented by use of a computer system 500 which, in variousembodiments thereof, may be a PC, local server, remote server, orcombinations thereof. In this regard, the term PC is intended toencompass any device which includes a memory subsystem and a processorsubsystem configured to perform processing operations using the contentsof the memory subsystem. Accordingly, it is noted that the term PCencompasses POS devices such as those described herein, for example acomputerized cash register coupled to a pinpad device. In certainembodiments thereof, particularly those for which a merchant offering aprogram has plural stores in which transactions need to be trackedacross multiple locations, for example, by providing a tender-based cashprogram which returns a cash rebate in return for tendering payment forthe goods to be purchased in a specified form regardless of the purchaselocation, one or more components of the computer system 500 may beembodied as a network server residing at a remotely located controlcenter and tied to plural local servers, each residing at a respectivestore operated by the merchant. In such an embodiment, transactionswould be executed at the wide area network (WAN) network level. In analternate embodiment, it is contemplated that one or more of componentsof the computer system 500 may be embodied as a local server residing ata work station located on the premises of a specific store operated bythe merchant. In this embodiment, the local server would be tied to eachdownstream POS installed within the store and tied to the upstream WANnetwork server. In accordance with this embodiment, information capturedor required locally, for example related to initial enrollments ofcustomers in one or more programs, updates to the profiles of existingcustomers and/or information related to transactions which maymaterially affect rewards distributed to customers, would need to beupdated periodically and made accessible to all locations. Accordingly,it is contemplated that locally captured information such as each newenrollment, change or execution of a transaction related to a loyaltyprogram be uploaded to the WAN network server located at the controlcenter for later download to each local server, for example, on a dailybasis. In such an embodiment, transactions may be captured, executed, orboth at the local area network (LAN) level. In still another alternateembodiment, it is contemplated that one or more components of thecomputer system 500 may be embodied as a POS tied to an upstream LANserver located, with the POS, within a store operated by the merchant.In turn, the LAN server would be tied to an upstream WAN network server.As with the prior embodiment, information captured or required at alocal level such a information related to initial enrollments ofcustomers in one or more programs, updates to the profiles of existingcustomers and/or information related to transactions which maymaterially effect rewards distributed to customers, would need to beupdated periodically. Accordingly, it is contemplated that each newenrollment, change or execution of a transaction related to a loyaltyprogram be uploaded to the WAN network server located at the controlcenter for later download to the LAN network server located at eachstore operated by the merchant and, in turn, for subsequent download toeach POS located at the store and coupled to the LAN network server.

In this regard and with reference to FIG. 5A, a multi-tier orhierarchical computing architecture 600 is contemplated whereininformation and/or applications may reside at computer systems 500A and500A residing at various tiers or levels. For example customer financialinformation may reside at a remote, centralized location havingheightened security which is accessible at a local level via the WAN.Likewise, less sensitive information such as loyalty programparticipation information may reside at a local level and be accessibleat a POS via the LAN. Such a multi-tier system is shown in FIG. 5A,which various like components thereof having like reference numeralsdescribed in more detail with reference to FIG. 5B and further describedwith respect to the various methods described herein that are carriedout on the computing system.

The computer system 500 will now be described in greater detail withreference to FIGS. 5A-C. For ease of description, the computer system500 has been greatly simplified and that many details not necessary foran understanding of the invention have been omitted. Furthermore,various components and functionality of the methods described herein mayreside and be executed by the computing system according to the detaileddescription set forth previously. In this regarding FIG. 5B shows suchcomponents and their relationships via flow arrows between components(e.g., communications, operable coupling, functional relationships,etc.), and such disclosure is supplemental to the more detailedfunctional and communication relationships described previously herein.As may be seen by reference to FIG. 5B, the computer system 500 iscomprised of a processor subsystem 502 coupled to a memory subsystem 504by a bus subsystem (not shown). As used herein, the processor subsystem502 encompasses the total processing capacity within the computer system500, including, but not limited to, the central processing unit (CPU),any secondary processing unit or device residing within the computersystem 500 and the like. Similarly, the memory subsystem 504 encompassesthe total memory capacity within the computer system, including, but notlimited to, the main memory, auxiliary memory (e.g., databases) and thelike. As may be further seen, residing within the processor subsystem502 are a first (or transaction identification) application 506, asecond (or ACH transaction) application 508, a third (or loyaltyprogram) application 510 and a fourth (or other merchant program)application 512. While illustrated, in FIG. 5B, as residing within theprocessor subsystem 502, each of the first, second, third and fourthapplications 506, 508, 510 and 512 is comprised of a series of lines ofcode, maintained in the memory subsystem 504 and executable by theprocessor subsystem 502, and thus embodied as executed instantiations inprocessor subsystem 502. Further, while FIG. 5B illustrates each of thefirst, second, third and fourth applications 506, 508, 510 and 512 asbeing discrete applications, it is fully contemplated that one or moreof the applications may, in fact, be subroutines within a commonapplication. Similarly, any one of he first, second, third and fourthapplications 506, 508, 510 and 512 may be configured as pluralapplications residing on the same or different processing units ordevices, including distributed units or devices, which collectivelycomprise the processor subsystem 502. Finally, while FIG. 5B suggeststhat each of the first, second, third and fourth applications 506, 508,510 and 512 reside on a common processor unit or device, the one or moreof the applications may instead reside on a discrete and/or distributedprocessor unit or device of the one or more processor units or deviceswhich, as previously set forth, collectively form the processorsubsystem 502.

As may be further seen in FIG. 5B, the memory subsystem 504 is comprisedof plural memory areas, which have been described during the discussionof the various method executed by the computing system or which will beapparent in view thereof. Examples of such memory areas include,including a first (or transaction types) memory area 514, a second (orACH transaction access information) memory area 516, a third (or ACHtransaction participation information) memory area 518, a fourth (orloyalty program benefits) memory area 520, a fifth (or loyalty programenrollees) memory area 522, a sixth (or other program benefits) memoryarea 524 and a seventh (or other program enrollees) memory area 526. Inturn, the ACH transaction access information memory area 516 issubdivided into plural sub-areas, specifically, a first (or enrollees)memory sub-area 528 and a second (or authorization codes) memorysub-area 530. While FIG. 5B shows each of the memory areas 516, 518,520, 522, 524 and 526, as well as memory sub-areas 528 and 530, as beingcontiguous areas within the memory subsystem 504, each such memory areamay be comprised of one or more discrete and/or distributed locations,within the memory subsystems 504, accessible by write or read commandsto a specified address corresponding to the discrete and/or distributedlocations. Similarly, while FIG. 5B implies that the memory sub-areas528 and 530 are located, in their entirety, within the second memoryarea 516, the memory sub-areas 528 and 530 may each be distributed amongone or more of the locations which collectively define the memory area516. One or both of the memory sub-areas 528 and 530 may be comprised ofdiscrete contiguous areas within the memory subsystem 504 (in which caseany such discrete areas would be considered to form part of the secondmemory area 516) or may be comprised of one or more discrete locationswithin the memory subsystem 504 (in which case any such discretelocations would be considered to form part of the second memory area516).

In the description which follows, reference shall be made to “lists” ofinformation which is maintained in various ones of the memory areas 516through 526, and the contents of which having been described in moredetail previously. As used herein, the term “list” refers to a series ofentries, each written to a respective address within the correspondingmemory area, comprised of a series of data bits which describes certaininformation contained in that entry. For example, a memory area may beused to describe a program which, for example, may be comprised of adescription of the membership in and the benefits provided by themerchant program. In turn, the memory area would include one or morelists, each comprised of a series of entries. In one configuration, thememory area would include a single list in which each entry is anencoded description of a member in the program and the benefits accordedto that member. In another configuration, the memory area would includefirst and second lists. In the first list, each entry would be anencoded description of a member of the program and, in the second list,each entry would be an encoded description of each benefit which may beaccorded to one or more members of the program. A link between eachmember of the program and the benefits which the member is eligible toreceive would then be established. The foregoing description has beengreatly simplified and that only those details which are necessary to anunderstanding of the disclosure have been included in the descriptionset forth herein.

A description of a transaction will now follow. The description thatfollows includes certain specifics regarding the manner in which thetransaction is executed. Such specifics should not be viewed as eitheran implicit or explicit statement as to configuration of any particularportions of the process by which a transaction completing a transaction.Rather, in order to set forth a clear and concise description of theprocess, it was necessary to select a single configuration for thedisclosed process. Thus, while the process may have a wide variety ofconfigurations, only one such configuration is disclosed herein.

The transaction to be described herein is a card-free paymenttransaction in which a customer seeks to pay for goods by initiating amodified ACH transaction which may cause funds to be drawn from achecking account maintained in a financial institution by the customer.After a cashier has determined the amount needed to purchase the desiredgoods, the customer indicates that they intend to use the merchant'scard-free purchase program to purchase the goods. The customer wouldthen indicate the desired form of payment by depressing a button marked“card-free purchase” on a pinpad installed at and coupled to a POSmanned by the cashier. The POS would then generate a message for displayon the pinpad which reads “Please enter your ten digit telephonenumber.” Upon the customer entering the telephone number using thepinpad, the POS would generate a second message, again for display onthe pinpad, which reads “Please enter the month and date of your birth(XXYY).” Upon the customer entering the month and date of birth, again,using the pinpad, the POS would generate a third message, this onereading “Please enter your four digit security code, for display on thepinpad The customer would again use the pinpad to enter their securitycode.

Using the information provided by the customer, the POS would thenconstruct an authorized ACH transaction message for transmission via 540to the computer system 500. The authorized ACH transaction message wouldbe comprised of first, second and third fields, the first containing atransaction type code, the second containing an authorization code andthe third containing a transaction descriptor. The transaction typefield indicates, based on the desired form of payment input by thecustomer, that the transaction to be executed by the POS is a card-freepayment transaction. The authorization code contains the informationnecessary to access the financial information, maintained by thecomputer system 500, to execute the desired card-free paymenttransaction. Finally, the transaction descriptor contains any otherinformation necessary for the computer system 500 to complete thetransaction. For purchases, the transaction descriptor would contain thecost of the goods to be purchased by the customer.

Upon construction of the authorized ACH transaction message, the POStransmits via 540 the authorized ACH transaction message to thetransaction identification application 506. The transaction application506 may then identify the type of transaction to which the receivedauthorized ACH transaction message relates. To identify the type oftransaction, the transaction application 506 compares via 541 thetransaction type contained in the first field of the received authorizedACH transaction message to the list of transaction types maintained inthe first memory area 514. Upon identifying a match between thetransaction type contained in the first field of the received authorizedtransaction message to one of the listed transaction types, thetransaction identification application would forwarding the receivedauthorized ACH transaction message to the appropriate application forexecution of the message. Here, as the matching transaction type is anACH transaction, the transaction identification application wouldforward via 542 the received authorized ACH transaction message to themodified ACH transaction application 508.

Upon receipt of the authorized ACH transaction message from thetransaction identification application 506, the modified ACH transactionapplication 508 first determines if the message is actually anauthorized message. To do so, the modified ACH transaction application508 may compare via 543 a first portion of the authorization codecontained in the second field of the authorized transaction message tothe list of people who have registered for card-free payment ofpurchases contained in the first sub-area 528 of the second memory area516 of the memory subsystem 504. As previously set forth, each personthat has been enrolled for card-free payments is uniquely identified bythe combination of their ten digit telephone number and their four digitbirth date. Thus, to confirm that the authorized ACH transaction messagehas been issued on behalf of a person who has registered for card-freepayment of transactions, the modified ACH transaction application 508compares the first portion of the second field of the receivedauthorized transaction message containing the telephone number and birthdate for the person requesting card-free payment of a transaction to thelist of registrants contained in the first memory sub-area 528. Uponidentifying a match between the first portion of the second field of thereceived authorized transaction message and an entry in the list ofregistrants contained in the first memory sub-area 528, the modified ACHtransaction application 508 determines that the person requestingcard-free payment of a transaction is a person who had registered forthe card-free payment program.

Each registrant set forth in the list of registrants maintained in thememory sub-area 528 is linked via 544 to a PIN contained in a list ofsecurity codes maintained in the second memory sub-area 530. While theperson requesting card-free payment of a purchase has been identified,in order to authenticate the requesting person, the modified ACHtransaction application 508 shall access via 545 and compare the PINcontained in a second portion of the second field of the receivedauthorized ACH transaction message to the PIN, contained in the list ofsecurity codes maintained in the second memory sub-area 530, linked via544 to the registrant contained in the list of registrants maintained inthe first memory sub-area 528 matched to the first portion of the secondfield of the received authorized ACH transaction message. If the PINcontained in the second portion of the second field of the receivedauthorized ACH transaction matches the linked PIN, then the modified ACHtransaction application 508 concludes that the identify of the personrequesting card-free payment of a purchase has been confirmed as aperson entitled to make card-free payments for purchases.

Having confirmed that the person requesting card-free payment of apurchase is a person entitled to make card-free payments for purchases,the modified ACH transaction application 508 may now initiate an ACHtransaction via 546. In addition to a PIN, each registrant in the listof registrants maintained in the first memory sub-area 528 is linked via547 to an entry, in the third memory area 518, containing theinformation to be used by the modified ACH transaction application 508to complete the card-free payment for a purchase. As previously setforth, the information to be used to complete payment includes therouting number assigned to the financial institution which maintains anaccount that the registrant intends to debit to pay for the purchase andthe account number for that account. Accessing via 546 and using therouting number and account number linked via 547 to the personpreviously identified as having requested card-free payment for apurchase and the amount of the purchase contained in the transactiondescriptor of the authorized ACH transaction message received from thetransaction identification application 506, the modified ACH transactionapplication 508 assembles a request for initiation of an ACH transactionfor transmission via 548 to a payment switch 700 of FIG. 5C, which (1)generates a record for the ACH transaction for transmission to adatabase; and (2) passes the request to an interface 750 to the bankingsystem 800 of FIG. 5C. In turn, the interface 750 formats theinformation contained in the request originated by the modified ACHtransaction application 508 into a format suitable for processing by thebanking system 800, bundles the request with other requests andinitiates a corresponding transaction with the banking system forprocessing, by the banking system in accordance with conventionaltechniques described previously. The modified ACH transactionapplication 508 further notifies the POS of transaction approval via555.

As previously set forth, applications other than the transactionidentification application 506 and the modified ACH transactionapplication 508 may reside on the processor subsystem 502. One suchapplication is the loyalty program application 510. Use of stand-aloneapplications which administer loyalty programs are known and need not bedescribed in great detail herein. Briefly however, one method in whichsuch a stand-alone loyalty application may function is that the POStransmits via 540 a loyalty program transaction message to thetransaction identification application 506 (if multiple applicationsthat provide services to customers of the merchant reside on theprocessor subsystem 502) or directly to the loyalty program application510 (if no other applications which provide services to customers of themerchant reside on the processor subsystem 502). If appropriate, thetransaction identification application 506 would identify the message asa loyalty program transaction message and re-direct the message via 549to the loyalty program application 510. In contrast with the authorizedACH transaction message, the first field of the loyalty programtransaction message would identify the message as a loyalty programtransaction message, the second field of the loyalty program transactionmessage would contain the account number of the customer enrolled in theloyalty program and the third field would contain the informationrelated to customer's transaction with the merchant necessary to providethe customer with the benefits to which they are entitled. To confirmthe identity of the customer requesting benefits and the benefits towhich the customer is entitled, the loyalty program 510 may interact via550 with the list of loyalty program enrollees maintained in the fifthmemory area 522 and the loyalty program benefits maintained in thefourth memory area 520 and linked via 551 to the list of enrollees inthe loyalty program maintained in the fifth memory area 522. Afterdetermining via 552 the benefits to which the enrollee is entitled, theloyalty program application may forward via 553 a command message to thePOS which may cause the POS to provide the benefits to the customer. Anyother merchant program applications 512, for example, a tender-basedreward program, may be accessed and operate in a manner similar to theloyalty program, as described previously herein and depictedfunctionally in FIG. 5B. Accordingly, further description of how theother merchant program application 512 functions is not necessary.

As previously set forth, if a customer is both entitled to makecard-free payments for purchases and receive benefits by virtue of theirenrollment in the loyalty program, the customer is identified as being aparticipant in the loyalty program. While it is contemplated that thelinked loyalty program may be configured, one suitable example isdescribed below. The foregoing description is provided purely by way ofexample and it is fully contemplated that other configurations areequally suitable for the purposes contemplated herein.

For a linked loyalty program, the process at the POS may remaingenerally unchanged. However, in one configuration of the linked loyaltyprogram, the transaction descriptor constructed for transmission to thetransaction identification application 506 may be modified to includethe information necessary to determine the benefits to which thecustomer is entitled should they be participants in the linked loyaltyprogram. In an alternate configuration, in order to eliminate thetransfer of unneeded loyalty program information for customers who areenrolled in the modified ACH payment processing program but are notenrolled in the loyalty program, the POS may be configured tomaintaining a list of unique identification codes and, if the customerto which the unique identification code has been assigned, thecorresponding loyalty program account number for the customer. In thisconfiguration, the customer would only need to provide their uniqueidentification code entitling them to card-free payments for purchases.In turn, the POS would search the list of unique identification codesfor a match with the unique identification code provided by thecustomer. If the unique identification code matching the provided uniqueidentification code has a corresponding loyalty program account numberassociated therewith, the POS would then append the informationnecessary to determine the benefits to which the customer is entitled tothe transaction descriptor. In still another configuration, upondetermining that the customer requesting a card-free payment for apurchase is also a member of the loyalty program offered by themerchant, the POS may construct two messages for transmission to theprocessor subsystem—a first to be used in the manner previously setforth to permit the customer to make a card-free payment for a purchaseand a second to be used in the manner previously set forth to permit thecustomer to receive the benefits to which they are entitled to receiveas a participant in the loyalty program. As before, the foregoingconfiguration may be similarly employed if the customer requesting acard-free payment for a purchase is also enrolled in another programoffered by the merchant, for example, a tender-based reward distributionprogram, or is also enrolled in both a loyalty program and anotherprogram offered by the merchant, for example, the tender-based rewarddistribution program.

Returning to the configuration in which the POS determines whether thecustomer requesting a card-free payment is also a member of the loyaltyprogram and in which the authorized ACH transaction message istransmitted to the transaction identification after modification, of thetransaction descriptor, to include the information necessary to providethe benefits to which the customer requesting a card-free payment for apurchase is entitled to as a participant in the loyalty program, theprocess by which the ACH transaction is initiated is modified slightlyto provide the customer with the benefits associated with being aparticipant in the loyalty program. As previously set forth, each entryin the memory sub-area 528 identifying a person authorized to makecard-free payment for purchases is also linked via 556 and 557 to thecorresponding entry or entries for that person in the memory sub-areaslisting other programs offered by the merchant for which that person hasenrolled. For example, if the customer requesting a card-free paymentfor a purchase is also enrolled in the loyalty program, the entry in thememory sub-area 528 for that person would be linked via 556 to thecorresponding entry for that person in the fifth memory area 522identifying those customers enrolled in the loyalty program. Similarly,if the customer authorized to make card-free payments for purchases isalso enrolled in another program such as the tender-based rewarddistribution program, the entry in the memory sub-area 528 for thatperson would be linked via 557 to the corresponding entry for thatperson in another memory area, for example, the memory area 526,identifying participants in the tender-based reward distributionprogram. Memory sub-areas may be further linked, for example sub-area526 linked via 560 to sub-area 524.

While preferred embodiments of the invention have been shown anddescribed, modifications thereof can be made by one skilled in the artwithout departing from the spirit and teachings of the invention. Theembodiments described herein are exemplary only, and are not intended tobe limiting. Many variations and modifications of the inventiondisclosed herein are possible and are within the scope of the invention.Where numerical ranges or limitations are expressly stated, such expressranges or limitations may be understood to include iterative ranges orlimitations of like magnitude falling within the expressly stated rangesor limitations (e.g., from about 1 to about 10 includes, 2, 3, 4, etc.;greater than 0.10 includes 0.11, 0.12, 0.13, etc.). Use of the term“optionally” with respect to any element of a claim is intended to meanthat the subject element is required, or alternatively, is not required.Both alternatives are intended to be within the scope of the claim. Useof broader terms such as comprises, includes, having, etc. may beunderstood to provide support for narrower terms such as consisting of,consisting essentially of, comprised substantially of, etc.

Accordingly, the scope of protection is not limited by the descriptionset out above but is only limited by the claims which follow, that scopeincluding all equivalents of the subject matter of the claims. Each andevery claim is incorporated into the specification as an embodiment ofthe present invention. Thus, the claims are a further description andare an addition to the preferred embodiments of the present invention.The discussion of a reference herein is not an admission that it isprior art to the present invention, especially any reference that mayhave a publication date after the priority date of this application. Thedisclosures of all patents, patent applications, and publications citedherein are hereby incorporated by reference, to the extent that theyprovide exemplary, procedural or other details supplementary to thoseset forth herein.

1. A method of enrolling a customer in a merchant payment program,comprising: (a) providing by the customer account information while at apoint of sale; and (b) associating by the merchant a uniqueidentification number with the account information such that thecustomer may pay for goods purchased from the merchant via an ACHtransaction from the account prior to the customer leaving the point ofsale.
 2. The method of claim 1 wherein the point of sale is a check-outlane.
 3. The method of claim 2 wherein the performance of steps (a) and(b) in the check-out lane does not adversely affect the quality ofservice for other customers waiting in the check-out lane.
 4. The methodof claim 1 wherein the performance of steps (a) and (b) at the point ofsale occurs in less than about 1 minute; 45 seconds, 30 seconds, 15seconds.
 5. The method of claim 1 wherein the unique identificationnumber is generated and provided by the customer.
 6. The method of claim5 wherein the unique identification number comprises the customer'stelephone number, date of birth, or both.
 7. The method of claim 1wherein the unique identification number is a unique card numberprovided by the merchant.
 8. The method of claim 1 further comprisingassociating a security code provided by the customer with authorizationfor the payment of goods purchased from the merchant.
 9. The method ofclaim 1 further comprising verifying by the merchant the identity of thecustomer.
 10. The method of claim 1 further comprising verifying by themerchant the validity of the account information provided by thecustomer.
 11. The method of claim 1 further comprising cross-checkingthe identity of the customer against a list of prohibited customers. 12.The method of claim 1 further comprising associating by the merchant theunique identification number with a savings program such that thecustomer may accumulate savings from the merchant in accordance with thesavings program.
 13. The method of claim 12 further comprising providingthe customer with a loyalty card having a unique card number andassociating by the merchant the unique card number with the accountinformation such that the customer may conduct business with themerchant via an ACH transaction from the account by using the uniqueidentification number, the unique card number, or both.
 14. The methodof claim 1 wherein the customer may purchase goods via the uniqueidentification number with one or more merchants in addition to theenrolling merchant.
 15. The method of claim 13 wherein the customer maypurchase goods via the unique identification number, the unique cardnumber, or both with one or more merchants in addition to the enrollingmerchant.
 16. The method of claim 15 wherein at least one of the othermerchants provide the customer with an additional unique card numberassociated with a savings program of the other merchant and theadditional unique card number is associated with the account informationsuch that the customer may purchase goods with the other merchant via anACH transaction from the account by using at least one of the uniqueidentification number, the unique card number, the additional uniquecard number, or combinations thereof.
 17. The method of claim 16 whereinthe purchasing of goods by the customer with the enrolling merchant orone or more other merchants accumulate savings from one or both of suchmerchants in accordance with the respective savings program.
 18. Themethod of claim 1 further comprising presenting electronically to thecustomer at a point of sale terms and conditions of the savings program;and accepting electronically by the customer at the point of sale theterms and conditions of the savings program.
 19. The method of claim 18wherein the presenting and accepting are via a pinpad.
 20. The method ofclaim 1 wherein the merchant is a grocer.
 21. The method of claim 1wherein the account information identifies two or more separate accountssuch that the customer may select the account at time of payment. 22.The method of claim 21 wherein the separate accounts comprise accountsfrom different financial institutions.
 23. The method of claim 21wherein the separate accounts comprise a savings account, a checkingaccount, a line of credit, a credit card account, or combinationsthereof.
 24. The method of claim 23 wherein the line of credit or creditcard account is from the merchant.
 25. The method of claim 1 furthercomprising providing one or more additional unique identificationnumbers corresponding to one or more additional users authorized by thecustomer and associating the one or more additional uniqueidentification numbers with the account information such that theadditional authorized users may likewise purchase goods from themerchant.